Indian ocean billet export market subdued on bid-offer disparity

Indian BF grade billets export market remained muted from the last few weeks on bid-offer disparities. Higher domestic realisations in finished steel, lesser allocations in exports and falling bids from overseas markets kept trades at bay.

SteelMint's bi-weekly price assessment for Indian billets export (150*150mm, 3SP/4SP, BOF route) stood at around $750-770/tonne (t) FOB on 14 Apr'22, stable w-o-w.

Factors weighing on Indian billet exports

• Chinese SHFE rebar futures fall: According to data maintained with SteelMint, China's SHFE rebar futures contract for Oct'22 delivery closed at RMB 5,004/t ($785/t) on 14 Apr'22, a w-o-w fall of RMB 66/t ($10/t). However, on d-o-d basis, a sharp increase of RMB 89/t ($14/t) was noticed. Meanwhile, steel billets prices in China's Tangshan remained stable at RMB 4,780/t ($750/t) on 14 Apr'22, inclusive of 13% VAT. However, prices fell sharply by RMB 80/t ($12/t), w-o-w.
  
  
  

• SE Asia imported billets less active: SteelMint's assessment of imported billets (150*150mm, 3SP) into the Philippines fell by around $5/t and stood at around $800-810/t, CFR Manila. Bid-offer disparities have limited trades.
  
  
• Importers in Egypt lower bids for billet imports: The Egyptian market is coming down and buyers are not ready to pay more than $800/t CFR, against the last we heard at around $810-815/t CFR, sources informed SteelMint.
  
  
  
• Higher realisations in India's domestic finished steel segment: SteelMint's BF-route rebar price assessment was recorded at INR 74,000/t exy-Mumbai, up by INR 500/t, w-o-w. Thus, higher domestic finished longs prices have kept mills' active in finished steel sales in the domestic market, rather than going for billet exports. Also, production curtailment at few primary mills have limited billet export allocations.
  
  

IF-route billet export offers from India fall - However, as per the sources India induction furnace (IF-grade, 3sp) billet export offers from western India are now hovering at around $785/t FOB against the last price levels of $800/t FOB for the deals concluded for Africa. However, limited deals have also been reported on the reduced offer recently.

A few market sources highlighted that talks are on for Russian billet exports. It would be interesting to see the impact as billet export allocations from Iranian mills may remain limited in the short term amidst lack of clarity on the recently-announced tariffs.