India: Billet export offers to Nepal remain stable amid active demand

India's primary steel mills, based in the eastern region, have kept their blast furnace (BF)-route billet export offers for Nepal stable at around $640/t CPT Raxaul border.

• Sources informed that demand remained active and about three-four rakes (8,000-10,000 t) of deals were reported this week within the same price range.
  
  
• The constant surge in offers through IF-route has resulted in poor buying and current offers are hovering around $620/t exw Durgapur, equivalent to $645/t CPT Nepal. Offers inched up by $15 w-o-w.
  
  
• Nepal buyers are largely booking BF-route billets due to attractive price.
  
  
• Domestic billet offers in Nepal hovered around NPR 82,000/t exw ($650/t), excluding of taxes.
  
  

Active demand for sponge iron

• Furnace owners were on their toes in terms of bookings of sponge iron from India amidst improvement in power supply over the last couple of months during the monsoon season.
  
  
• About 7,500 t of sponge iron deals were confirmed for Nepal from India during the current week. Current offers are at $445-450/t CPT Nepal for FeM 80% (lumps 70%, fines 30%) material.
  
  

Wire rods

• Demand remained sluggish from Nepal on account of the export duty imposed by the Indian government, which has made products costlier by around $100/t, with duty at 15%.
  
  
• Current offers by plants for the IF-route, commercial grade material, stands at around $820-825/t, while offers by the primary mills (BF-route, grade SAE 1008) were reported at $880/t, both on CPT Nepal basis.
  
  

Domestic rebar offers rise

• Domestic steel demand in Nepal remains limited. However, due to strengthening steel prices in the Indian market, rebar offers in Nepal increased by NPR 1,000/t ($8/t) and were reported at NPR 92,000/t ($734/t) on ex-works basis, excluding VAT, for size 12mm material.
  
  
• With falling forex reserves in Nepal, it is expected that demand for steel products are unlikely to improve amidst the seasonal slowdown in construction activities.
  
  
• However, if raw material prices climb further in India, Nepal mills may go for a hike in offers in order to pass on higher input costs.