India’s billet export trading activity has improved during the past week with persisting inquiries from Asia, but prices have softened marginally with buyers resisting higher prices and also due to higher freight rates, SteelOrbis has been informed on Wednesday, June 24.
According to traders, though aggregated bookings of ex-India billets received by all integrated local steel mills have been estimated in the range of around 90,000-95,000 mt over the past seven working days, buyers were unwilling to accept prices as high as $390/mt FOB announced last week, and most contracts have been signed at $380-385/mt FOB.
For Chinese buyers, the acceptable price ceiling was reported in the range of $400-405/mt on CFR basis if they were to conclude supply contracts with Indian suppliers, the traders said. According to the freight forwarders, the current dry bulk freight rate from Paradip port on India’s east coast to Qingdao port in China is $19.65/mt, up sharply from $11-15/mt depending on the volume previously. As a result, $400-405/mt CFR China is equivalent to $380-385/mt FOB.
Steel Authority of India Limited (SAIL) has concluded an export tender of 20,000 mt at $382/mt FOB for September shipment to China.
An eastern India-based steel mill has concluded deals for two tonnages of more than 40,000 mt in total with traders at $407/mt CFR. The FOB price was estimated at around $380-382/mt, because initially the volumes were purchased for Taiwan and the freight from India can be up to $25/mt, but the final shipment destination can be changed for China, sources have said.
State run Rashtriya Ispat Nigam Limited (RINL) reportedly concluded a supply contract for the Middle East for an estimated volume of large dimension billet of 25,000 mt at slightly higher price of $386/mt FOB.
However, sources pointed out that state-run steel mills have not floated any fresh export tenders during the past week.
“The resumption of Chinese buying, even at conservative prices, is a positive. But in the medium term, Sino-India trade relations are in uncertain times particularly for state-run local exporting steel mills,” an official at a Indian private steel mill said.
“Right now there is no adverse impact, but with the Indian government planning a slew of counter-measures to reduce ex-China imports across product categories, retaliatory measures are a cause of concern for all local exporting steel mills as overseas shipments of semis are crucial to keep our plant capacities operational at higher levels,” he added.