Ex-India pellet prices have bounced back with buyers representing mills in China returning to the market after the holiday, followed by a few large-volume deals, but some large sellers still holding back offers awaiting further price consolidation as business activity gains momentum, SteelOrbis learned from trade and industry circles on Friday, October 10.
Sources said that ex-India pellet prices have gained $5/mt to the range of $118-125/mt CFR China with the price at the higher end applicable for high grade pellet with silica-alumina content less than three percent.
According to the sources, while two large-volume deals were confirmed at higher prices, trade activity is expected to gain momentum in the coming weeks as business activity picks up and sellers ready more exportable volumes at ports, responding to price consolidation.
An Odisha-based pellet producer reported a trade for 75,000 mt at $118-120/mt CFR China, while southern India-based sellers concluded a contract for 50,000 mt at $122/mt CFR, the sources said.
“Enquiries are rising after the holiday in China but the number of deals is yet to pick up. Buyers are assessing the new price trend, while sellers are holding back volumes and will start to replenish stocks at ports once prices consolidate further,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“However, we are maintaining cautious optimism. Sellers need to be conservative in quoting higher to avoid buyers’ resistance, as finished steel prices are still weak and mills in China will need to stabilize output before committing restocking in large volumes for high raw material prices to sustain,” he added.