Large Indian mills have maintained an active stance on billet exports over the past week, offering large volumes, and, while price realizations are stable, expectations of improvements in prices have not materialized, SteelOrbis learned from trade and industry circles on Wednesday, July 29.
Ex-India billet prices are stable at $450-460/mt FOB, with BOF-based producers' materials still available at the higher end of the range.
According to the sources, an export tender held by a government-run mill, which expired late last week, fetched the highest bid of $455-460/mt FOB, the same as in the previous auction.
Though there is a lack of any consolidation at higher levels, which had been expected earlier, this did not prevent large mills from continuing to place large volumes on offer for export.
This week, two new tenders for the export market have been announced by RINL. One tender for 60,000 mt of 3SP/4SP 150 mm/200 mm billet for shipment by mid-August was opened on Monday. Another tender is for 30,000 mt of 5SP 150 mm billet for shipment by August 20. The high export allocations reflect weak domestic merchant sales.
Also, an eastern India-based mill is heard to have sold a cargo for delivery to the Middle East at $458/mt FOB, the sources said.
Though the current prices from India and especially the shipment time (China has mainly September shipment, for instance) can be attractive for some customers, the logistical challenges remain tough. Traders report rising costs and war-risk premiums with the freight rates to the MENA region at $45-50/mt.
“The stable export price is offering a good outlet for excess domestic supplies. The easing of tensions along the Strait of Hormuz may improve sales in the Gulf region, which is seeing firm demand but is constrained by logistical challenges,” an Indian source said. Higher freight rates may also keep prices for Indian billets stable at best in the near future.
