Indian billet exporters have remained inactive during the past week, as even some discounts would hardly lead to any successful deal in the face of increasingly aggressive pricing from other Asian suppliers and also as bearish conditions have deepened in most destination markets, SteelOrbis learned from trade and industry circles on Wednesday, October 26.
The tradable level for ex-India billet has remained at $480-500/mt FOB, but it has been mainly indicative, as Indian mills have still been targeting $520/mt FOB or just slightly below. At the same time, most buyers have been asking for below $500/mt FOB, which is unprofitable for India.
Signifying the worsening of bearish conditions in most export markets, neither any private nor any government mills have floated any export tenders at least for the last two weeks, and Indian sellers are unable to match sub-$500/mt FOB offer levels.
“It’s a fight to the bottom in the Asian region. We are staying out of it. We had submitted an offer in the Gulf Cooperation Council (GCC) region, but the buyer settled for a 40,000 mt ex-Iran deal at $479/mt FOB. Deals at such levels are a blow to our profitability. Ex-China offers to ASEAN are being reported at $500-510/mt FOB,” an official at a private integrated mill said.
“Indian offers that are being reported are largely notional in our assessment because sellers’ margins will be negative at $500-510/mt FOB. For ex-India billets, the breakeven point is largely at $520-530/mt FOB,” he said.
