Tender settled at USD 40/MT lower from last one.
Vizag Steel (RINL) floated an export tender of 40,000 MT blooms (150*150) and 30,000 MT billets (95*95mm) on 5 June’15 for July shipments.
The tender was held on 25 June, and according to sources, the company settled export of 40,000 MT bloom at USD 330-335/MT, FoB Vizag and is heard to be awarded to a Swiss base trading house Duferco. However, it failed to receive bids for 30,000 MT billet offered for export.
The company was expecting bids at around USD 350/MT for bloom in the event, but looking at the bulk quantity of purchase, it agreed to close the deal at USD 15-20/MT below expectation. Currently, the RINL is offering bloom at INR 24,700/MT, ex-Vizag in domestic market.
Falling billet offers from China (currently, at USD 325-330/MT CFR India/Bangladesh) has also weighed on Indian export prices. Last export tender by Vizag Steel was settled at USD 370-375/MT FoB, which has now dropped to USD 330-335/MT FoB. This shipment for bloom is expected to move to Bangladesh.
Bangladesh is a major destination for Indian billet exports. On one hand where Bangladeshi re-rollers are getting highly lucrative offers from China at USD 325-330/MT CFR Bangladesh, Indian offers have not been competitive.
Bangladesh re-rollers import about 1.5-2 MnT of billet per annum. Recently, the country has witnessed an increase of 40% in import duty on billet imports.
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