India: Nepal's Buying Remains Weak Amid Sharp Surge in Prices

Nepal - which is the largest buyer of commercial grade Billet & Wire rod has continued to show limited buying interest. As per exporters demand is weak due to sharp surge in prices and healthy stock with local mills in Nepal.

The latest offers for Induction grade Billet (100*100mm) reported at near about USD 470-473/MT ex-mill at Durgapur, eastern India, this is equivalent to USD 500/MT CNF Nepal (Raxaul or Jogbani border).

As per exporters, today small deals of total about 1,000-1,500 MT have taken place, although the major buyers are still away and are in wait & watch mode due to sufficient stock and with assumptions of soon price reduction through the Indian mills.

It should be noted that amid constant rise in Indian domestic prices, the export offers to Nepal also gain sharply by about USD 25-30/MT in last couple of weeks. Thus this has made poor buying interest through the neighbouring countries.

Further the Wire rod export offers stated at near about USD 545-550/MT ex-mill, Durgapur. This landed cost to Nepal would be around USD 575-580/MT CNF Raxaul border. However as per exporters & manufacturers, buyers are not interested as similar offers are being floated through the large mills for blast furnace grade wire rod (grade SAE 1008).

Participants are assuming demand to remain sluggish if offers remain on higher side. Meanwhile routine buying in small parcels is expected to remain active, they added.

Recent RINL's (Vizag Steel) export tender received poor response for Wire rod as the bids were quite low by about USD 30/MT than the company's expectations. Meanwhile the company had concluded Billet (90*90mm) export tender at close to USD 435-440/MT, ex-mill. The freight cost to Nepal by sources reported at around USD 40/MT CFR Raxaul border.