Indian export offers for high grade iron ore fines (with Fe content of 63 percent and higher) have continued to remain under pressure, moving down by $3-4/mt during the past week to around $106/mt CFR China in a market nervous due to concerns over the liquidity of buyers, traders said on Wednesday, May 7.
According to two Orissa-based miner-exporters, reports of buyers facing a stiffer liquidity crunch have become more widespread during the week and local traders have been cautious even about concluding deals for small volumes.
From an exporter’s point of view, it has been very difficult to assess buyers’ abilities to provide letters of credit even if offers are accepted, the miner-exporters said.
Buying interest has already been weak over the past two months and uncertainties over buyers’ liquidity have pushed the local market further into a bearish situation, the miner-exporters said.
Local offers are unlikely to find much support and the $100/mt mark seem to be the next target, the exporters added.
Sources said that current offers are expected to be driven by short-term sentiments in the spot market since the outlook for iron ore will continue to remain negative.