Indian export offers for high grade iron ore fines (with Fe content of 63.5 percent and higher) have declined by $3-4/mt to the range of $63-64/mt CFR China during the past week, amid renewed pressures due to a cutback in
production by Chinese steel mills and low prospects of restocking by them, traders said on Wednesday, January 28.
"In any case, there have not been any significant shipments of Indian iron ore for the last few months. Now with offers inching towards the $60/mt mark, a five-year low, exporters are unwilling to conclude transactions for even small volumes," said an Orissa-based miner-exporter.
"As for buyers, they too are waiting for the next bottom since, with reports of Chinese steel mills cutting back
production, there is no urgency to restock raw materials," he added.
Market sources said that negligible transaction volumes have been reported in the market because of the extended weekend holiday for Indian Republic Day and only small miner-exporters with pithead stocks and facing liquidity issues have concluded small transactions at current low levels. The sources said that, with the Indian government ruling out any adjustment of export tax despite low international prices, current offers net of the 30 percent export tax and 15 percent royalty ensure a negative margin for most exporters and hence a revival of the market is not expected in the medium term.