The downtrend in ex-India pellet prices has gained momentum amid mounting negative signals from China including the softening of finished steel prices, the fall in the price of fines, and adverse weather conditions resulting in no deals reported over the past week.
Sources said that ex-India pellet prices are down $7/mt to $108-110/mt CFR, but both buyers and sellers are unwilling to conclude deals amid rising multiple uncertainties in China.
They said that raw material demand is expected to fall further in the coming week and this will continue to put pressure on prices as mills in China start controlling output and reduce import bookings.
“The outlook for pellet exports has become very bleak suddenly. The fall in fines price in China is around $10/mt and hence this indicates that ex-India pellet prices still have a lot of downside risks,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“Port stocks in China are down by around 0.1 million mt over the past week, but are still sufficient to meet lower demand. We see the lack of bookings being prolonged,” he said.