Ex-India pellet prices have edged up during the past week, reacting to the overall improvement in sentiments among buyers following a rise in iron ore fines prices and greater optimism on macro-economic indicators in China following the truce with the US on tariffs, but actual deals concluded have still remained muted, SteelOrbis learned from trade and industry circles on Friday, May 16.
Sources said that ex-India pellet prices have gained $2/mt to the range of $108-109/mt CFR, but, with only one seller confirming a large-volume deal, a source in trade circles maintained that, “despite the improvement in price, the market is yet to gain depth as mills in China are awaiting consolidation of finished steel prices before shifting the raw material choice to higher-priced pellets”.
The sources said that the only deal during the week in review was a large-volume supply contract for 120,000 mt reported by an Odisha-based seller. The contracted tonnage comprised two lots, with one lot of 50,000 mt for higher grade with silica-alumina content less than three percent and the average price for the full tonnage worked out at $111/mt CFR.
“Local sales realisations are still higher compared to sales overseas. Local pellet exporters are awaiting stronger buying interest and more offers to be converted into contracts. Buyers are holding back deals waiting for positive macro-economic indicators in China to have a greater positive impact on finished steel prices before committing fresh import deals on raw materials,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“But with sentiments improving, we expect it to get translated to more active buying in the coming days. Pellet producers will do fresh comparative analysis on export and local sales prices before starting to build up inventories at port stockyards for efficient export delivery commitments,” he said.