Chinese buyers snap up Indian steel, defying trade tensions

A worker cuts steel bars for a construction project in the Indian city of Amritsar. (AFP)
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Updated 30 August 2020

Chinese buyers snap up Indian steel, defying trade tensions

  • New Delhi afterwards tightened rules to restrict Chinese investment in India and initiated measures to curb its trade with Beijing

NEW DELHI/BEIJING: India’s steel exports more than doubled between April and July to hit their highest level in at least 6 years, boosted by a surge of Chinese buying in defiance of tensions between Beijing and New Delhi.

Traders said reduced prices had driven the purchases as Indian sellers sought to get rid of a surplus generated by the impact of COVID-19 on domestic demand and generate much-needed income.

It was unclear whether the sales broke any trade rules, but the China Iron and Steel Association said in a statement it was monitoring them.

Leading Indian steel companies Tata Steel and JSW Steel were among Indian companies that sold a total of 4.64 million tons of finished and semi-finished steel products on the world market between April and July.

That compared with 1.93 million tons shipped in the same period a year earlier, government data analyzed by Reuters showed.

Of the 4.64 million tons, Vietnam and China bought 1.37 and 1.3 million tons of steel respectively. The Chinese purchases are by far the largest since data was first collated in the current form beginning with the fiscal year April 2015-March 2016.

Neither Tata, JSW nor India’s federal ministries of steel and commerce responded to emails seeking comment.

Vietnam has been a regular buyer of Indian steel, but China’s emergence as a leading buyer, replacing New Delhi’s traditional markets, such as Italy and Belgium, is more surprising.

An already uneasy relationship between New Delhi and Beijing, became severely strained after violent border clashes in June.

New Delhi afterwards tightened rules to restrict Chinese investment in India and initiated measures to curb its trade with Beijing.

The politics are at odds with market realities.

Although China, the world’s leading steelmaker produces vast quantities, it needs imports as it ramps up infrastructure spending.

Two industry sources, asking not to be named because they are not authorized to talk to the media, said major Indian steelmakers offered a discount of at least $50 a ton, selling hot-rolled coils and billets to China at $430-$450 per ton against the $500 offered by most Chinese producers.

Hot-rolled coils, a flat steel product, are mostly used to make pipes, automobile parts, engineering and military equipment.

The China Iron and Steel Association official told Reuters it was paying particular attention to the imports of hot-rolled coils.

During the first four months of the 2020-21 fiscal year, China and Vietnam together bought close to 80 percent of India’s total hot-rolled coils exports, the data showed, while the product constituted more than 70 percent of India’s steel exports.

Ji Renjie, a general manager at China’s Ningbo Henghou Group said the company in May bought 30,000 tons of hot-rolled coils from India for July shipment and expected to take delivery of another cargo of a similar size in October.

“I mainly do iron ore trades and just bought several cargoes of hot-rolled coils this year due to rosy profit margins,” said Ji.

AM/NS India, the joint venture between ArcelorMittal and Nippon Steel, in an email also said China had been a big buyer, accounting for 35 percent of the approximately 0.5 million tons of hot-rolled coils it shipped between April and July.

Bitcoin heads for worst weekly loss in months

Updated 22 January 2021

Bitcoin heads for worst weekly loss in months

  • The world’s most popular cryptocurrency fell more than 5 percent to an almost three-week low of $28,800 early in the Asia session

SINGAPORE: Bitcoin wavered on Friday and was heading toward its sharpest weekly drop since September, as worries over regulation and its frothy rally drove a pullback from recent record highs.
The world’s most popular cryptocurrency fell more than 5 percent to an almost three-week low of $28,800 early in the Asia session, before steadying near $32,000. It has lost 11 percent so far this week, the biggest drop since a 12 percent fall in September.
Traders said a report posted to Twitter by BitMEX Research suggesting that part of a bitcoin may have been spent twice was enough to trigger selling, even if concerns were later resolved.
“You wouldn’t want to rationalize too much into a market that’s as inefficient and immature as bitcoin, but certainly there’s a reversal in momentum,” said Kyle Rodda, an analyst at IG Markets in Melbourne, in the wake of the BitMEX report.
“The herd has probably looked at this and thought it sounded scary and shocking and it’s now the time to sell.”
Bitcoin was trading more than 20 percent below the record high of $42,000 hit two weeks ago, losing ground amid growing concerns that it is one of a number of price bubbles and as cryptocurrencies catch regulators’ attention.
During a US Senate hearing on Tuesday, Janet Yellen, President Joe Biden’s pick to head the US Treasury, expressed concerns that cryptocurrencies could be used to finance illegal activities.
That followed a call last week from European Central Bank President Christine Lagarde for global regulation of bitcoin.
Still, some said the pullback comes with the territory for an asset that is some 700 percent above the 2020 low of $3,850 hit in March.
“It’s a highly volatile piece,” said Michael McCarthy, strategist at brokerage CMC Markets in Sydney. “It made extraordinary gains and it’s doing what bitcoin does and swinging around.”
Second-biggest cryptocurrency ethereum initially slipped to a one-week low on Friday before rising 6 percent late in the Asia session to $1,177.