India: Billet export price indications drop on lower bids

Indian BF-grade billets export price indications fell sharply on drop in bids followed by competitive offers from CIS nation and fall in scrap offers. SteelMint’s bi-weekly price assessment for Indian billets exports (150*150mm, 3SP/4SP, BOF route) stood at around $705/tonne (t) FOB on 11 May 2022, down $30/t w-o-w.

An Indian steelmaker floated an ocean sale export tender for 30,000 t of steel blooms (150*150mm, 3SP/4SP) in end-April.  According to sources, the tender received bids at around $700/t FOB. However, the tender outcome could not be confirmed till the time of publishing this report.

Factors weighing on Indian billet exports-

• SE Asian imported billets offers down sharply : SteelMint’s assessment of imported billets (150*150mm, 3SP) into the Philippines stood at around $715/t, CFR Manila, a sharp drop of $40/t on weak demand. No trade was heard so far this week.
• Competitive billet offers from Russia: Taiwan-based mill booked billets (150mm) from Russia at around $650/t CFR levels towards the closing of last week. Lower priced sales have weakened market sentiments further.
• Sharp fall in scrap offers: Turkey’s ferrous scrap import market saw some activities happening after remaining silent for the last couple of weeks due to Ramadan and Eid holidays. A UK-origin cargo of 20,000 t of HMS (80:20) was booked by an Aegean-based steel mill recently. The transaction was concluded at a price of $480/t CFR Turkey, lower by around $40 d-o-d.
• Chinese SHFE rebar futures plunge post-holidays: Chinese SHFE rebar futures witnessed a continuous downtrend post the Labour day holidays. According to data maintained with SteelMint, China’s SHFE rebar futures contract for October 2022 delivery was closed at RMB 4,681/t ($696/t) on 11 May 2022, a sharp w-o-w fall of RMB 242/t ($36/t). However, on a d-o-d basis, prices increased by RMB 74/t ($11/t).

Meanwhile, steel billets prices in China’s Tangshan inched up by RMB 20/t ($3/t) to RMB 4,640/t ($690/t) on 11 May 2022, inclusive of 13% VAT. Prices fell sharply by RMB 170/t ($25/t) w-o-w amid falling futures.

Lack of clarity in the market led incoherent buying decisions. Indian steel mills are still showing lack of interest on the ongoing billet export bids. On the other side, competitive offers from CIS nations and zero Covid situation in China made the billet market more conscious.