Ex-India pellet prices have continued to harden as the probability of production cuts by mills in China has receded and buyers have returned to conclude large-volume deals in order to restock ahead of the national holidays later this month, SteelOrbis learned from trade and industry circles on Friday, September 15.
Ex-India pellet prices are up $2/mt for the second consecutive week to the range of $125-130/mt CFR China, but, more significantly, the average deal size has increased, leading to bullish sentiments spreading among sellers.
Sources said that an Odisha-based pellet plant has concluded a deal for 50,000 mt of high-grade pellet with silica-alumina content less than three percent at $125/mt CFR, while another plant located in the same state has reported a deal for 40,000 mt at around $127/mt CFR.
A central India-based pellet producer reported a trade for 50,000 mt at $126/mt CFR, the sources said.
A southern India-based government-run pellet producer has floated an export tender for 50,000 mt scheduled to close for bidding early next week.
“The apprehended production cuts by mills in China do not seem to be happening. In fact, we learn that crude steel output is actually rising. This is reflected in resumption of restocking and a bigger positive is that the average deal size is improving,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“We see the trend being sustained at least until next week as mills in China will tend to continue restocking ahead of their national holidays later this month and amid reports of slower arrivals at ports against older supply contracts,” he said.