Ex-India pellet prices have continued to lose ground under pressure from the absence of buying by mills in China and the preference for port stocks to meet limited demand, while the Indian domestic market offers better opportunities, prompting sellers to divert port stocks for local sales, SteelOrbis learned from trade and industry circles on Friday, January 10.
Sources said that ex-India pellet prices are down $2/mt to the range of $106-108/mt CFR China and, with domestic offers exceeding export realisations by INR 1,400/mt ($16/mt) on ex-plant basis, sellers have prioritised local sales and no significant export trades have been confirmed during the past week.
According to the sources, a southern India-based pellet producer closed an export tender for 50,000 mt, but no information is available on the bid prices received or whether any deal has been concluded.
“Export is not viable at current prices. Domestic sales are a better option. Several pellet producers with plants along the eastern coast are diverting port stocks to local mills located inland,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“Unless ex-India prices recover to levels of $120/mt CFR minimum, sellers are unlikely to aggressively submit offers. Such a recovery does not seem likely as mills in China are either fully stocked or prefer low-cost fines. Higher-priced pellets are not on their shopping list,” he said.