Ex-Indiapelletprices have suffered a setback over the past week reacting to the expected weak raw material demand outlook from the softening of finished steel prices in China and bearish conditions aggravated by the fall in local prices, SteelOrbis learned from trade and industry circles on Friday, October 21.
Ex-Indiapelletprices have lost $10/mt to $95-100/mt CFR China with small-volume trades of higher grade pellets with alumina content less than three percent fetching slightly higher realizations.
According to trade circles, Brahmani River Pellets Limited (BRPL) is reported to have concluded a relatively smaller volume of 20,000 mt for end-of-November shipment at $105/mt CFR for grade with less than three percent alumina.
The same seller also concluded a trade for 20,000 mt, but at the lowest price of the week at $90/mt CFR for lower grade, the sources said.
Market circles speculated on a reported deal by an Odisha-based seller at $100/mt CFR to a buyer in the Middle East, but neither volume nor price has been confirmed by the seller.
“Imports by buyers in China are steadily falling as blast furnace operators are bearish over finished steel prices and are unlikely to restock imported raw materials. The landed price differential in China between iron ore lumps with 62 percent Fe content and imported pellets has narrowed. But with finished steel prices remaining weak, even the small differential is prompting blast furnace operators to prefer lumps as feedstock to maximize cost efficiencies,” a member of thePelletManufacturers’ Association ofIndia(PMAI) said.
“The mood among sellers took an additional hit from the slump in localpelletprices in the face of the rise in availability of cheaper iron ore lumps from merchant miners in Odisha,” he said.
For the second consecutive week, merchant local trade prices of pellets have suffered losses, moving down by INR 250/mt ($3/mt) to INR 7,750/mt ($94/mt) ex-plant in Odisha, touching a three-month low in the face of a strong price and supply-side competition from lumps, sources said.
$1 = INR 82.30