Ex-India pellet prices have lost ground in the past week with buyers from China either withdrawing from the market or seeking very low prices, resulting in a sharp erosion of the robust market activity seen in the previous week, SteelOrbis learned from trade and industry circles on Friday, February 28.
Sources said that ex-India pellet offers have declined to levels of $114-115/mt CFR China compared to $116-118/mt CFR.
Most sellers were reluctant to push sales overseas after the weakening of ex-India prices led to a widening of the differential with local sales realisations. According to industry insiders, the gap between domestic and export sales realisations has widened to around INR 1,100/mt ($13/mt) on ex-plant basis, prompting most sellers to hold back offers.
An Odisha-based seller has reported a deal for 60,000 mt at $114/mt CFR, while a southern India-based pellet producer has concluded sales of 40,000 mt at $115/mt CFR, the sources said.
“We are not active in exports after the recent fall in prices. Also, unlike the earlier week, buyers are looking at cheaper raw material alternatives and are not willing to pay a premium for high grade pellet with low alumina content. Buyers are expecting a sharper correction. Sellers are holding back offers, expecting a rebound,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.