Indian export offers for high grade iron ore fines (with Fe content of 63.5 percent and higher) have continued to slide during the past week, losing $4/mt to $53-54/mt CFR China, amid worsening sentiment regarding steel prices and the uncertain outlook for raw materials, traders said on Friday, May 13.
“Clearly, offers touching the $70/mt mark no so long ago constituted a market aberration. Market expectations of steel prices sustaining higher levels have been belied and this has made the raw material outlook very uncertain,” an Odisha-based miner-exporter said.
“We have little clue which way current offers will move, as it seems Chinese mills have completed their restocking amid falling steel prices,” the miner-exporter said.
“Given that most traders representing Chinese steel mills have remained on the sidelines towards the close of the week, only a new bottom of around $50/mt could trigger fresh bookings,” he added.
Market sources said that, with tumbling futures prices, the physical market in India will not be the prime driver of offers, causing most aggregating trader-exporters to remain on the sidelines at current offer levels.
In addition, in India there are pressures from oversupply with iron ore stockpiles being reported at 140 million mt, up from levels of 128 million mt around the same time last year, sources said.