Indian mills decrease rebar export offers by $20/t on lower global prices

Indian rebar export offers witnessed a downward trend this week with mills lowering offers sharply to $790-800/tonne (t) CFR Hong Kong on an actual weight (AW) basis, market sources informed SteelMint.

SteelMint’s last assessment on 6 May 2022 for BF-route rebar (B500B) stood at $815/t CFR Hong Kong on an AW basis. Considering this, Indian rebar export offers fell by around $25/t, w-o-w and sharply by $130/t on a monthly basis.

Factors behind fall in export offers:

• Competitive offers from the Middle East: Middle East-based mills have reportedly returned to the rebar market with offers at around $785/t CFR Hong Kong on AW basis for July shipment which are lower compared to Indian offers.
• Turkey rebar export offers continue downtrend: Turkey-based mills have reduced rebar export offers by around $65/t w-o-w amid a continuous fall in the country’s imported scrap prices due to the absence of buyers and steelmakers from both domestic and export markets. Currently, rebar export offers are assessed at $825/t FOB Turkey.
• Fall in Indian domestic offers: SteelMint’s BF-route rebar (12-32mm) price assessment was recorded at INR 71,000/t exw-Mumbai on 6 May 2022, a fall of INR 500/t, w-o-w. Weak demand in the domestic market contributed to the fall in prices. On the other hand, SteelMint’s bi-weekly price assessment for Indian billets exports (150*150mm, 3SP/4SP, BOF route) stood at around $705/t FOB on 10 May 2022, down $30/t w-o-w and a sharp fall of around $55/t m-o-m.
• Volatility in SHFE rebar futures: Volatility in China’s SHFE rebar futures pulled down rebar export offers. According to data maintained with SteelMint, the SHFE rebar futures contract for October 2022 delivery closed at RMB 4,670/t ($688/t) on 13 May 2022, witnessing a sharp fall of RMB 64/t ($9/t) w-o-w.

Notably, Indian mills were not active in the rebar exports market of late due to better realisations in the domestic market. However, the recent price corrections in the domestic market and the approaching monsoon season in July may slow down construction steel demand in the country which will most probably force Indian mills to allocate their materials in the export market to liquidate their piled-up inventories.