India: Billets export shipments fall for 6 consecutive months in Feb

India, one of the leading exporters of steel billets, saw a fall in shipments for the sixth consecutive month in Feb’22. The volumes stood at 0.18 million tonnes (mnt) last month, a significant 24% m-o-m fall as against 0.23 mnt in Jan’22, as per customs data collated by SteelMint.

Country-wise imports

Kenya emerged as the leading importer of steel billets from India at 0.08 mnt in February. Exports to Kenya from India witnessed a sharp rise of 167% m-o-m as compared to 0.03 mnt in Jan’22.

Nepal was in the second position among the top importers with 0.05 mnt in the month under review followed by Sri Lanka with 0.04 mnt. Export volumes to Nepal and Sri Lanka increased significantly by 25% and 33%, respectively.

Exports down y-o-y in Jan-Feb’22

Exports of the material from India in Jan-Feb’22 stood at 0.41 mnt, a y-o-y decrease of 38% compared to 0.66 mnt in the same period last year.

Factors weighing down Indian billets export bookings

• Bid-offer disparities: Higher bids for steel billets from the Indian domestic market kept export bookings low as compared to those from the key importing nations like China and South East Asia. Almost no firm bids for imported billets were heard from these countries.
• Higher domestic realizations: Indian mills raised long steel prices sharply in Feb’22. The monthly average of SteelMint’s BF-route rebar price assessment was recorded at INR 62,000/t exy-Mumbai, up by INR 6,550/t, m-o-m. Also, SteelMint’s daily steel billets (IF-route) index was assessed at a monthly average of INR 48,390/t exw-Raipur in Feb’22. Thus, higher domestic finished long prices kept price expectations on the higher side even for billets export bookings. Indian mills were not ready to reduce billets offers considering the high input costs.
• Prevailing holidays: Indian billets export remained less active during the Christmas and New Year holidays as no sea-borne export deal was heard to be concluded. Meanwhile, most of the sellers in the Indian market adopted a wait-and-watch mode, waiting for the respective holidays to end.

Outlook

The Indian billets export market may gather momentum following a recovery in bids and supply curbs amidst the Russia-Ukraine political tensions. Also, Chinese steel futures and global price uptick post-the New Year holidays pushed up billet export bookings later in Feb’22 which looks promising.