Ex-India pellet prices remained stable but no deals were reported as buyers stayed away from the market even after Labour Day holidays ended, while sellers continued to focus on local sales offering better margins, SteelOrbis learned from trade and industry circles on Friday, May 9.
Sources said that ex-India pellet prices were kept stable at $106-107/mt CFR China amid silent trade activity.
According to sources, two large Odisha based pellet producers were heard to have commenced sales negotiations for comparatively small tonnage of 40,000-50,000 mt in total but no final contract was confirmed.
It was pointed out that some large producers led by Jindal SAW Limited cut domestic pellet price by about INR 300/mt ($3/mt) narrowing the gap between export and local sales. But despite the narrowing, domestic pellet prices still offers a better margin of average INR 1,800/mt ($21/mt) on ex-plant basis.
“The expected post holidays restocking has not materialised. Mills in China are preferring lower cost fines. Sellers on their part are unwilling to adjust export prices as local sales are strong both in demand and price,” a member of Pellet Manufacturers’ Association of India (PMAI) said.
“We are expecting some improvement in ex-India price on tightening of global supplies. Local sellers will await price consolidation as most do not have ready stocks at ports having diverted volumes to hinterland to be able to commit quick deliveries to domestic mills,” he said.