Ex-India pellet prices have inched lower in the absence of buyers from China during the ongoing long holiday in the country, and no deals have been reported during the past week given the bearish outlook for when business resumes later in the month, SteelOrbis learned from trade and industry circles on Friday, October 6.
Ex-India pellet prices have lost $2/mt to $120-124/mt CFR and, even though trade has been silent due to the holiday in China, there are concerns over the emerging trend once business activity resumes, since the usual pre-holiday restocking was absent this time.
Sources said that, on the one hand, there are signals of higher supplies from major global pellet producers and, at the same time, prospects of production cuts by mills in China continue to loom going forward, which would keep the pressure on prices.
“The lull in trade activity during the holidays is normal. But the absence of restocking well ahead of the holidays is a tentative indication of the raw material demand depression. The number of sellers offering seaborne cargoes is also rising and this will check prices from consolidating higher,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“The bearish outlook on exports is already taking a toll on local prices, with at least three of the largest local pellet plant operators reducing domestic prices by INR 300/mt ($4/mt) over the course of the past week,” he said.