Indian Billet Prices Hit 4-Year Low

Indian billet suffers further price correction; hits levels which were last seen in 2010. 

Domestic billet prices have hit a 4-year low on the grounds of low demand and squeezed price gap between primary & secondary steelmakers. In domestic market, primary steel players are now trading at offers, which have reduced premium between them and secondary steelmakers to INR 2,000-3,000/MT, a steep decline from the earlier premium of INR 4,000-5,000/MT. Thus, buyers are shifting towards primary players’ offers.

In a week, billet prices in Raipur (central India) went down by INR 400/MT to INR 25,000/MT and in Mumbai by INR 800/MT to INR 26,200/MT. These levels were last seen during Dec’10. As primary manufacturers increase supply, market participants see a further scope of price correction.

Recently, NINL’s (Nilachal Ispat Nigam Ltd) sale tender for 22,000 MT concast billet was extended from 22 June’15 to 15 July’15 because of low buying interest.

Semi Finish Prices may Fall Further Based on Below Reasons:

1. Seasonal slowdown in construction & real estate works
2. Number of sellers are more as compared to number of buyers
3. Declining iron ore prices in domestic market, which will increase production of sponge iron