Indian export offers for high grade iron ore fines (with Fe content of 63.5 percent and higher) have failed to maintain their recovery and have declined by about $4/mt during the past week to the range of $67-68/mt CFR China as buyers have refrained from concluding any transactions, traders said on Wednesday, January 14.
According to an Orissa-based miner-exporter, Indian shipments have continued to be almost null as no significant transactions have been reported in the market with buyers rejecting higher levels over the week. At the time, with no short-term bottom in sight, buyers are seeking offers only to retreat without any concluding any deals in anticipation of a new low to emerge in the short term, he said.
While the global outlook for iron ore fines has remained negative, Indian exports have become unviable considering that Indian mining operation costs are on the high side due to high taxes and high freight costs, causing current offers to be uneconomic, he added.
Market sources said that traders representing Chinese steel mills who were seeking offers have retreated amid reports of a further softening of billet and long product prices and, as a result, the market anticipates a further slowdown of restocking by Chinese steel mills.
The marginal mid-week gains have been mostly due to technical reasons tracking the futures market trends, but iron ore offers will soon fall back as soft steel prices set the market direction, sources said.