India: Billets exports stagnant, mills divert focus to domestic market

The Indian blast furnace (BF)-grade billet export market almost shifted towards the domestic segment. Increased realizations in the domestic market compared to exports led sellers to divert sales. As result, in the last couple of days, sellers stayed away and offers remained stable.

India steel mills are facing difficulties in exporting owing to the large gap between offers and bids following the current global meltdown. Exporters are not ready to sell at lower bids and prefer the domestic market which is fetching higher realisations, sources informed.

Factors influencing subdued billets exports market

• SE Asian imported billets offers down sharply: SteelMint's assessment of imported billets (150*150mm, 3SP) into the Philippines stood at around $527/t, CFR Manila, down around $30-31/t w-o-w due to low demand.
  
  
• Billet export prices from Russia up: CIS billet price indications were heard at around $565/t FOB this week, up $10/t w-o-w amid holidays.
  
  
• Chinese imported billet prices fall further: SteelMint's assessment of imported billets (150*150mm, 3SP) into China stood at around $488/t CFR, down by around $2/t w-o-w.
  
  
• Chinese domestic billet prices drop over fall in SHFE rebar futures: Chinese Shanghai Futures Exchange (SHFE) rebar futures witnessed a significant fall this week. According to data maintained with SteelMint, China's SHFE rebar futures contract for October 2022 delivery closed at RMB 3,830/t ($567/t) on 20 July, a fall of RMB 80/t ($11/t) w-o-w. However, the same witnessed a d-o-d rise of RMB 56/t ($8/t).
  
  
  

Meanwhile, steel billet prices in China's Tangshan declined w-o-w by RMB 100/t ($15/t) to RMB 3,550/t ($525/t) on 20 July 2022, inclusive of 13% VAT.

Outlook

Most Indian billets players are likely to remain out of the exports market due to better price realisations from the domestic market in the near term.