Billet export tender floated by Vizag Steel (RINL) has received bids lower by USD 15/MT from previous tender and may be called off.
RINL, which issued an export tender for 20,000 MT Billet and 80,000 MT Bloom on 27 Nov, 2014 and extended its bids till 27 Jan’15, is likely to pull back the tender on poor bids from participants.
Steady as well as shocking decline in prices of Scrap & Billet across the globe has led to dull response in Indian Billet export tender. Market sources mentioned the bids for Billet were around USD 390-400/MT, FoB Vizag Port. This was too low and the company will fetch better realizations in the domestic market.
Other major Billet export market such as CIS Nations are offering Billet at USD 375/MT, FoB Black sea. In fact, Chinese manufacturers were also heard to have offered Billet at USD 370-380/MT, CFR South East Asian Nations. Therefore, after such reasonable offers available in the market, why would buyers bid more than these levels?
RINL’s another export tender for Billet is in pipeline. Company has offered about 10,000 MT Billet and 75,000 MT Blooms for export till 11 Feb’14.
Indian Billet Prices slip by INR 2,000/MT (USD 32/MT) M-o-M
Indian Billet prices have declined by over INR 2,000 /MT (USD 32/MT) in last one month owing to falling Steel & Scrap prices in the global market. Imported Scrap offers to India have plunged over USD 30/MT in the month of February amid falling prices in Turkey, which have corrected by upto USD 50/MT in last few trading sessions.
Cheaper Offers of Imported Billet from China
As observed, imported Billet offers from China have increased last week due to upcoming holidays in China (18-24 Feb, 2015). Most of steel mills want to sell their stock before Chinese market gets closed. Current offers are hovering in the range of USD 375-380/MT, CIF India.
This creates a big challenge for Indian Billet manufacturers as landed cost of imported Billet to rollings mills based in Mumbai and Chennai are around INR 26,000-26,500/MT (inclusive of 5% Duty and Port handling charges). Whereas, spot offers are in the range of INR 28,800-29,000/MT (ex-works).
NINL sold MS Billet to Odisha based Integrated Steel Unit
NINL (Odisha), which had floated a tender on 30 Jan, 2015 for 16,000 MT Billet, sold the material at INR 26,000/MT to a plant based in Patratu. This is the 1st time Patratu plant has purchased Billet from another plant.
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