Ex-India pellet prices have inched lower as inquiries and trade has come to a sudden halt amid a lack of clarity over the economic stimulus planned in China and Chinese mills taking a pause from restocking, SteelOrbis learned from trade and industry circles on Friday, July 28.
Ex-India pellet prices have edged down by $2-3/mt to the range of $115-117/mt CFR China, with sellers not submitting any offers as buyers are almost absent from the spot market.
However, state-run pellet producer KIOCL Limited floated an export tender for 50,000 mt to close for submission of bids later next week.
According to trade and industry circles, there is a lack of unanimity over the short-term outlook. A section of sources maintained that mills in China are taking a pause to assess the government policy stimulus, causing the recent surge in trade activity to halt for a while. Another section claimed that the policy stimulus will offer little to heavy manufacturing and interest in seaborne raw material will remain weak as the price of finished steel is rising but not at the expected pace to support higher-priced raw materials.
“The pellet export market is in a delicate balance and can go in either direction going forward. There are lot of uncertainties facing buyers, largely from China. Whether this is temporary or not is difficult to take a call on now. The positive is that port stocks in China, we hear, are down by at least 0.5 million mt over the past week,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“Local Indian pellet prices have remained stable at INR 7450/mt ($90/mt) ex-plant and the gap with export prices has therefore been maintained, indicating that trade has the potential to revive as soon as buyers return with bids,” he said.