Indian billet exporters are exploring alternative markets like Thailand, Philippines, Indonesia and Turkey to sell their cargos after China toughened berthing norms for Indian parcels. It has been learnt that recent billet export bookings made to China are now being offered in other markets at relatively lower prices (slightly above $700/t CFR levels), although no confirmed deals have been reported at the time of publishing this report.
Currently, Chinese domestic billet prices stand at RMB 4,920/t ($767) (including 13% VAT). The import parity at these levels would be around $640-650/t CFR China. Participants are of the opinion that more than the price, the availability of vessels is a much bigger issue. Chinese steel futures have witnessed further decline yesterday.
China had been India’s largest billet export market in FY ’21, contributing over 50% of total exports of around 7 mn t.
Indian domestic prices seem to be under pressure from the above factors. The exports of iron ore, pellets, billets, slabs are likely to be impacted quite significantly till the time China eases berthing rules. Indian mills will have to rely on other markets which are small as compared to China.
SteelMint’s daily billet index closed at INR 40,900($ 561), down by INR 500/t from the last trade.
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