Ex-India pellet price uptrend reverses as buyers withdraw for holiday in China

The recent sustained uptrend in ex-India pellet prices has been reversed during the past week, with prices suffering setbacks as buyers representing mills in China have withdrawn for the long holiday, bringing restocking to a halt even as some unsold volumes at port stockyards have been diverted for local sales at higher prices, SteelOrbis learned from trade and industry circles on Friday, October 3.

Sources said that ex-India pellet prices have declined by about $4/mt to the range of $113-120/mt CFR China, with prices at the higher end of the range applicable for high grades with silica-alumina content less than three percent, but no deals were done as even the stray bids received were at lows of around $105-108/mt CFR.

At least two traders said that an Odisha-based pellet producer diverted a 75,000 mt export allocation at port for domestic sale, fetching at least INR 1,100/mt ($12/mt) higher than export realizations on ex-plant basis.

“The completion of restocking by buyers ahead of the holiday in China was expected. But the fall in price has been sharper than expected. Sellers are focusing on domestic sales. Their export allocation volumes will depend on the new market trend that will emerge once business resumes in China,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.

“Our own assessment is that pellet prices will remain subdued and buying from China will be cautious as finished steel prices are still showing sluggish movement,” he added.