Nepal: Domestic Steel Demand Slows down owing to Elections

The domestic steel demand in Nepal have softened due to elections scheduled in mid of Dec 2017, SteelMint learnt from market participants.

Currently, the domestic steel prices in Nepal are firm despite low demand and the prices are assessed for commercial rebar at 62,000-63,000 MT Nepalese Rupee (INR 39,000) & Billet at 48,000-49,000 MT Nepalese Rupee (INR 30,000-30,700). The both prices are ex-Birgunj, Nepal & excluding VAT @ 13%.

Nepal does not have sufficient billet making facility due to power crisis amid high tariff, thus there the re-rollers largely imports billet from India due to less voyage time and easy pay mode through LC (letter of credit).

According to the re-rollers in Nepal, “last billet purchase for induction grade was made towards start of Nov’17 at around USD 405-410/MT (ex-mill) Durgapur/Rourkela. Meanwhile, the current offers are hovering at USD 420-425/MT ex-mill, but at these offers no major bookings have been made and people are waiting for price corrections.”

Nepal produces about 0.8 million tonnes of re-bar annually. According to the customs, the nation has imported about 296,700 MT billets & 35,400 MT Sponge iron during Q1 FY18 Nepalese calender (mid July to mid Oct). Further, in the same duration Finish long steel imports were at 66,500 MT & Flat Steel at 115,200 MT.

Nepal Imports (mid July 2017 to mid October 2017)

Quantity in MT
Source: Nepal Customs, SteelMint Research

Vizag Steel Receives Weak Response for Billet Exports to Nepal

Rashtriya Ispat Nigam Limited (RINL), also known as Vizag Steel, had invited a tender for export of 5,504 MT billet (IS2830 grade, 90*90mm) and material delivery scheduled by 30 Nov’17. The due date of the tender was 2nd Nov’17 till 11:00 AM (IST).

According to market sources report to SteelMint, the tender has received weak response with nearly two rakes getting sold at around USD 440/MT (ex-mill).