Indian ocean billets export market less active amid bid-offer disparities

The Indian billets exports market dried up in the last one week amidst bid-offer disparities. The recent billet export tenders floated by Indian mills were heard to have fetched lower bids compared to what mills expected and hence were not concluded.

SteelMint’s bi-weekly price assessment for Indian billets exports (150*150mm, 3SP/4SP, BOF route) stood at around $760-780/tonne (t) FOB on 22 Mar’22, up marginally by $10/t, w-o-w.

“Indian mills were heard targeting $770-800/t FOB levels for 3 SP, 150mm billets, but due to low bids the deal didn’t materialize,” shared a market source.

Recent tenders: Vedanta-owned and eastern India-based Electrosteel Steels Ltd (ESL) has floated an export tender for 20,000-30,000 t of billets (150mm, 3SP/4SP) with the due date being 16 Mar’22, according to sources. The tender is still scheduled for April.

State-owned Vizag Steel floated an ocean sale export tender for 30,000 t of steel blooms (150x150mm, 3SP/4SP grade) on FOB ST delivery basis against 100% advance payment terms. The due date for the tender is 22 Mar’22 and the delivery is scheduled for 10 May’22.

Factors supporting hike in offers by Indian mills

• Chinese SHFE rebar futures rise: According to data maintained with SteelMint, China’s SHFE rebar futures contract for May’22 delivery closed at RMB 4,983/t ($782/t) on 23 Mar’22, a w-o-w rise of RMB 79/t ($12/t). Also, the same witnessed an increase of RMB 65/t ($10/t), d-o-d.

Meanwhile, steel billets prices in China’s Tangshan rose d-o-d by RMB 30/t ($5/t) to stand at RMB 4,750 ($745/t) on 23 Mar’22, inclusive of 13% VAT and w-o-w by RMB 70/t ($11/t).

• SE Asia imported billets offers rise: SteelMint’s assessment of imported billets (150*150mm, 3SP) into the Philippines currently stands at around $815-830/t, CFR Manila, up by around $30/t, w-o-w.
• Hike in Indian domestic steel prices: JSW Steel has decided to increase rebar (12-32mm, IS1786) prices by INR 1,250/t ($16/t) with effect from 23 Mar’22 for end-March sales, sources informed SteelMint. Post-revision, the effective price stands at INR 71,000-71,500/t ($931-938/t) on FOR Mumbai basis, excluding GST at 18%.

China resumes billet exports: Chinese mills have reportedly sold around 50,000 t of steel billets to SE Asia and East Asian countries in the past one week. A deal for 20,000 t of billets (150x150mm) were heard concluded at around $780/t FOB, sources informed SteelMint.

Outlook: Indian steel mills are still keeping offers high as the domestic market is up sharply on raw material price hike. On the other side weak Chinese demand led the bids low. All these factors are expected to keep billet exports low from India.