Indian billet exports have lapsed into low activity as the rise in local billet prices in China was not matched by any improvement in appetite for imports, and bids in general over the past week have been lower than expected by mills, SteelOrbis learned from trade and industry circles on Wednesday, December 8.
Sources said that, while local integrated mills were still targeting price realizations of around $600/mt FOB, buyers in the Asian markets led by China have not been willing to accept such levels.
The sources said that a government-run steel mill, which closed an export tender for 30,000 mt of 150 mm billets on December 6, received the highest bid at $585-590/mt FOB, lower than a bid received for a similar tonnage tender at $595-598/mt FOB late last month. “RINL received lower bids in the tender yesterday. It will be interesting to see if they book or cancel, as their expectation is above $600/mt FOB,” an international trader said.
According to the sources, a stray deal was reported by an eastern Indian mill with a Middle East-based buyer for a modest tonnage at around $595/mt FOB. This price level was assessed by most market sources as very high already and not workable for most buyers.
The SteelOrbis reference price was settled at $585-595/mt FOB, down by $5/mt from last week.
“With China out of imports in the billet market, a lot of volume is getting diverted to the South Asian region. In view of this oversupply, buyers are negotiating very hard. Ex-India billet could be negotiated at $650/mt CFR by Southeast Asian buyers, but sellers are unwilling to concede despite the steady declines in price in the local market,” a source at government steel producer Rashtriya Ispat Nigam Limited (RINL) said.
“At the moment China is out of imports. Competition in the rest of the markets is getting fierce,” he said.
Meanwhile in the local market in India, billet prices have lapsed back into a downtrend with the gains of the earlier week wiped off, reflecting the weakening of rebar and sponge iron prices. Local billet prices have declined by INR 750/mt ($10/mt) to the range of INR 40,750- 41,000/mt ($543-546/mt) ex-works, market sources said.
$1 = INR 75.00