Ex-India pellet prices have continued to record strong gains riding on fading pessimism from China and the return of buyers committing large-volume deals, SteelOrbis learned from trade and industry circles on Friday, September 1.
Ex-India pellet prices are up by $7-9/mt to the range of $121-126/mt CFR China and more significantly deals sizes have been large, indicating more confidence among buyers to conclude deals even in a rising market.
The sources said that an Odisha-based pellet plant operator reported a trade for 50,000 mt at $121/mt CFR for end-of-September shipment, while a pellet plant operated by an Odisha-based integrated steel mill confirmed a trade for 55,000 mt at $123/mt CFR.
Even government-run pellet producer KIOCL Limited floated an export tender for 50,000 mt, which was possibly from old inventories as its plant remained shut down owing to the shortage of iron ore fines.
Sources said a central India-based pellet producer confirmed a deal for 35,000 mt at $124-126/mt for higher grade pellets with silica-alumina content less than three percent
“The mood among both sellers and buyers improved as the pessimistic outlook of the market in China earlier seems to have been exaggerated and mills are unlikely to go in for drastic production cuts as anticipated last month. Hence, the rush to restock through higher-volume deals,” a member of the Pellet Producers’ Association of India (PMAI) said.
“We expect the current round of restocking to continue for some more weeks based on reports that ports stocks in China have decreased over two consecutive weeks and new arrivals are slow,” he said.