An Indian state-owned mill closed a tender for a total of 30,000 mt of 150 mm billet late last week after negotiations since early June. This is a sign of a demand improvement, according to market sources, as earlier this month the producer had failed to close this auction, receiving bids that were too low.
According to market sources, the highest bid in the tender was at $610/mt FOB or just slightly below. The final sales destination has not been disclosed, but overall demand in Asia is likely to improve in the coming weeks, supported by the better situation in China. Accordingly, a trader has decided to book this material from India, while a week ago most bids that this mill received were at not above $600/mt FOB.
The SteelOrbis reference price for ex-India billet has so far remained stable from last week at $610-620/mt FOB. The higher freight rates have been preventing Indian export prices from rising and the future demand situation needs to be seen, according to market sources. At the moment, freight from India to Southeast Asia is assessed at $50-60/mt, while two weeks ago it was below $50/mt.
Another major Indian mill is going to close a tender for 125 mm billet on June 15, targeting a price at above $700/mt on CFR Manila basis, though last week the tradable level for BF-billet in the Philippines was at $690-700/mt CFR, according to SteelOrbis.
“I think that, if Chinese features open higher tomorrow (which is likely), Manila buyers will need to start paying higher,” an Asian trader said.
