Ex-India pellet prices have gained ground over the past week, supported by stray deals for high grades and tight supplies amid robust local sales, even though overall trading activity has remained quiet, SteelOrbis learned from trade and industry circles on Friday, December 5.
Sources said that ex-India pellet prices are up $2/mt to the range of $117-122/mt CFR China and no deals have been reported with buyers representing mills in China largely absent from the market.
However, a transaction for a large volume of 75,000 mt at a price of $123-124/mt CFR China for high grade pellet with silica-alumina content of less than two percent has buoyed up sentiments.
Furthermore, supplies for export have been tightening as most large producers have remained focused on serving robust local demand at better prices.
It was pointed out that, even though the gap between domestic prices and export offers has been reduced to INR 800/mt ($9/mt) on ex-plant basis, sellers still prefer domestic sales and have had very few exportable volumes at port stockyards.
“There are no buyers from China in the market now. A deal for high grade at a very good price boosted sentiments. Additionally, good local sales prompted producers to increase ex-India offers even if deals are not working out. This is not a problem as sellers do not have many volumes at ports either,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“We expect ex-India prices to move in a narrow range in the absence of a demand push. Any minor upward movement will largely be from the supply side, with sellers continuing to divert volumes to local sales and given lower export allocations,” he added.
