Ex-India pellet prices have failed to hold on to gains made early in the week and, though no major deals were heard even after the drop in prices, the mood among sellers has remained buoyant supported by robust trades in the local market, SteelOrbis learned from trade and industry circles on Friday, September 23.
Sources said that ex-India pellet prices rose to $115-120/mt CFR China but failed to hold their ground in the face of the rapid retreat by buyers and settled at $100-105/mt CFR, down from $107-110/mt CFR a week ago.
According to sources, buyers in China were bullish on the one hand based on the firming up of finished steel prices, but mills are still cautious about building up raw material stocks at higher levels.
The sources said that holidays in China early next month will prompt some fresh buying interest, but at the same time attempts by sellers to nudge up prices will be resisted.
Despite the sustained bearishness in overseas sales, sentiments in the local market received strong support from the sharp increase in trading volumes and consolidation in prices.
Traders and producers said that, while some bids in the eastern region have been heard at around INR 7,000/mt ($87/mt) ex-works, stable from the previous week, deals have been reported at INR 8,000/mt ($100/mt) around Raipur in the central region and even as high as INR 9,000/mt ($111/mt) ex-works for higher grades with alumina content of less than three percent.
Apart from the strong price, the local market has been supported by heavy trading activity, with at least two trades of 25,000 mt each reported at the highest price during the week at $111-115/mt on ex-works basis.
While no definitive official data are readily available, trade sources estimate that trading of at least 700,000 mt of pellets was completed during the past week on rising demand from blast furnace operators.