Lower bids weigh down Indian ocean billet exports sentiments

Indian BF-grade billets export market has remained subdued since the past few weeks on low bids and lower-than-expected realizations, given the higher domestic prices. SteelMint's bi-weekly price assessment for Indian billets exports (150*150mm, 3SP/4SP, BOF route) stood at around $750-770/tonne (t) FOB on 19 April 2022, stable w-o-w.

An Indian mill was heard to have floated an export tender for 30,000 t of steel blooms (150x150mm, 3SP/4SP) on FOB ST. delivery basis against 100% advance payment terms for early June delivery.

If sources are to be believed, bids received were at around $710-715/t, FoB levels, quite lower than the mill's expectations.

"Indian mills may not sell this low," commented a global trader.

Factors weighing on Indian billet exports

• Competitive billet offers from other regions: Billet offers from Indonesian mills were heard at around $790/t CFR Thailand. However, no deal has been heard yet. 
  
  
• SE Asia imported billets offer range-bound : SteelMint's assessment of imported billets (150*150mm, 3SP) into the Philippines remained stable against last week and stood at around $800-810/t, CFR Manila. No trade was heard so far this week.
  
  
• Chinese SHFE rebar futures remain volatile: According to data maintained with SteelMint, China's SHFE rebar futures contract for October 2022 delivery closed at RMB 5,106/t ($796/t) on 20 April, 2022, a sharp w-o-w rise of RMB 191/t ($30/t). Also, on a d-o-d basis, a sharp increase of RMB 95/t ($14/t) was noticed.
  Meanwhile, steel billets prices in China's Tangshan increased by RMB 20/t to reach RMB 4,830/t ($753/t) on 20 April, 2022, inclusive of 13% VAT. Prices rose on the week as well by RMB 50/t ($8/t).
  
  

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.

India, one of the leading exporters of steel billets, witnessed a significant fall in shipments in FY22. The volumes stood at 5.05 million tonnes (mnt) in the period under review, a 30% y-o-y fall as against 7.25 mnt in FY21, as per customs data collated by SteelMint. China continued to be the largest importer of steel billets from India at 1.15 mnt in FY22. However, the volumes dropped sharply by 64% y-o-y as compared to 3.23 mnt in the same period last year.