Indian export billet prices have moved down and mills were able to close a few tenders. On the other hand, local billet market has staged a slight recovery during the past week on improved export activity and due to producers attempting to pass on increase in pig iron costs; SteelOrbis was informed on Wednesday, August 28.
Market sources report that state run Rashtriya Ispat Nigam Limited (RINL) was successful in concluding an export tender offering 25,500 mt with the sources estimating the average price in range of $395-398/mt FOB. According to sources an eastern India based steel mill, put an estimated volume of 20,000 mt on offer in Southeast Asian market but was able to sell around 15,000 mt with a 10 percent discount on FOB price at $395/mt. Export prices have gone down visibly as previously offers and deals for the international market have been heard above $400/mt FOB. Market sources in Southeast Asia said that the traders have been already successful in selling the part of the billet, purchased in those tenders, at $425/mt CFR, which was the lowest level seen in the market recently.
Indian local billet market has staged a slight recovery during the past week with prices edging up by INR 700/mt to INR 28,700/mt ($400/mt) ex-works on improved export activity and producers attempting to pass on increase in pig iron costs.
The sources said that secondary steel mills reliant on merchant sourcing of pig iron as their feedstock were seen to be increasing billet prices to pass through the increases in pig iron prices, pointing out that merchant price of pig iron producers have increased by around INR 200/mt to around INR 23,500/mt ($327/mt) ex-works.
“Despite the slight recovery in billet prices I do not see the trend sustaining. Billet prices have moved up largely owing to pricing issues and not supported by any change in fundamentals because rebar producers are still facing weak demand and price depression as well as mounting unsold stocks and it would be difficult for downstream units to absorb the higher billet prices. They are expected to face resistance and fall back in the short term,” an eastern India based trader said.
$1 = INR 71.79