Indian export offers for high grade iron ore fines (with Fe content of 63 percent and above) have bounced back this week rising by $3-4/mt to $154-154/mt CFR China on the back of renewed interest from Chinese steel mills, traders said on Friday, February 1.
"There has been a sudden spurt in inquiries from buyers representing Chinese steel mills. This has prompted Indian miner-exporters and traders to increase offers, though no reports are available of large volume transactions being concluded," an Orissa-based trader said.
"Sentiments were revived by reports received in Indian markets that iron ore stocks at Chinese ports were low. Hence, Indian ore exporters are expecting more active restocking by Chinese mills," he added.
Market sources said that the Indian iron ore export market is currently gripped by uncertainty with miners demanding a reduction of the 30 percent export tax, though this is opposed by the domestic steel industry.
"Even some operating mines, particularly in Orissa, do not plan to increase production without clarity on the revision of the export tax. This has aggravated problems for traders who aggregate volumes from mines to conclude export shipments," market sources said.
"Export prices will continue to have a limited upside potential of $5-10/mt despite the revival of Chinese buying because of domestic limitations on miners and traders seeking to secure the volumes required by buyers," the sources said.