Ex-India pellet prices plunged as buyers from China paused bookings on reports of sufficient inventories and sellers saddled with large volumes at port stockyards, resulting on no deals confirmed over the past week.
Sources said that ex-India pellet price was down by around $4/mt at $116-119/mt CFR China and with buyers mostly absent and sellers unwilling to push sales at current levels, trade activity fell silent.
According to the sources, information available here indicated port stocks to be on the higher side of around 7 million mt and deals concluded immediately after Labour Day holidays early this month for which deliveries were in process, buyers were unwilling to extend any further import commitments.
It was pointed out that a number of inland pellet producers had diverted volumes to port stock yards just ahead of the Labour Day holidays anticipating the surge in price and volumes but with buyers retreated were now left with significant unsold stocks.
“The buoyancy seen in finished steel market and raw material restocking seen in China early this month has faded quickly. Also dispatches of previously booked tonnages are currently going on. This coupled with higher than average port stocks in China, buyers are holding back fresh booking,” a member of Pellet Manufacturers’ Association of India (PMAI) said.
“Few large local producers have cut domestic sales price by INR 200-300/mt ($2-3/mt). If the trend gains momentum, there are risks of supply side pressures building up on the price line,” he added.
