Indian exporters sell large billet volumes to China, prices higher in sporadic deals

Wednesday, 13 May 2020 17:18:22 (GMT+3)   |   Kolkata
       

Indian integrated steel mills have been active in pushing up billet export prices during the past week, supported by strong demand from Сhina and some other destinations. Prices moved up from last week in some recent bookings.

According to market sources, aggregate billet export volumes booked over the week are estimated at around 170,000-190,000 mt owing to Chinese buyers being active, seeing rapidly reviving local demand.

Traders said that most integrated steel mills, which had in the earlier week reduced billet export prices to book higher tonnages, were quick to seize opportunities to raise prices as volumes of trades have been increasing during the past week.

Market sources said export prices have increased to $362-365/mt FOB in recent deals compared to $355-360/mt FOB earlier. A few trades were even at a higher price, sources have said.

Last week, a private steel mill, which operates two plants in eastern India, concluded a deal for 55,000 mt for July shipment from its Odisha plant to China at $360/mt FOB, market sources said.

However, after that, one eastern India-based steel mill concluded two contracts for end June-early July shipment of 35,000 mt and 40,000 mt billet respectively with Chinese buyers at $365-366/mt FOB, which translates to a CFR price of $375-380/mt. There has been a rumor of a sale of 30,000 mt of Indian billet at $385/mt CFR China this week, but all major exporters denied this information and it has not been confirmed by the time of publication.

A small volume of Russian billet has been traded to China at $382/mt CFR recently.

Demand in the UAE has remained on the lower side owing to Ramadan, but traders said that prices of imported billet moved up slightly enabling ex-India billets to find acceptance among local traders. Sources said that a western Indian integrated steel mill has concluded a deal for 25,000 mt billet with a Dubai-based trader at $364/mt FOB.

“Most steel mills are redoubling efforts to export for deliveries in the May-July period as domestic demand for finished steel is expected to remain at minimal levels in the medium term. China is a comparatively new market for us, but we have commenced increasing our volume shipments to the Chinese market, particularly semis like billets,” a manager at Steel Authority of India Limited (SAIL) told SteelOrbis.

According to a senior manager at JSPL, inter-provincial movement of steel intermediates will continue to be restricted in China and this will continue for some more months. This has resulted in increased demand for imported semis at rolling mills around the coastal hinterland and hence JSPL has been exporting 60-80 percent of its production of semis currently when in previous year it was 60-70 percent dependent on domestic sales.


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