After a minor correction earlier, ex-India pellet prices have increased on back of major gains in iron ore prices in China although trades were limited to two deals, with sellers expecting the market to gain momentum, SteelOrbis learned from trade and industry circles on Friday, February 11.
Ex-India pellet prices have moved up $4/mt on the lower end to $201-209/mt CFR China and the limited trades were largely owing to stable port stocks and slightly nervous sentiments following directives in China to regulatory authorities to ensure price stability amid the sharp rise in prices and checks on pricing information.
However, sources said that local sellers are still bullish on the outlook and have discounted any major risks to prices from the current levels as blast furnace operators in China have been increasing feedstock utilization rates.
“Prices continue to harden despite low trades. The slowdown in deals is largely because we hear that port stocks in China have been stable at 4 million mt since early this month,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“But existing stocks will face a strong drawdown as steel production is expected to rebound in March and hence restocking will gain momentum going forward in February,” he said.
Sources said that, of the two deals reported over the past week, one was concluded by an Odisha-based plant for 55,000 mt at a price of $201/mt CFR. The second trade for 45,000 mt was reported to have been done by an eastern India-based producer at $209/mt CFR for high grade material of alumina content less than three percent, the sources said.
