The ex-India pellet market has remained strong over the past week amid continued restocking by mills in China, increasing sales volumes as they commence optimizing production post-winter, but price disparity has widened with Indian sellers accepting lower prices for high-volume bookings, SteelOrbis has learned from trade and industry circles.
Prices range at $190-195/mt CFR for higher grade pellets compared to as high as $198-202/mt CFR a week ago. But some sellers have reported deals at $175-185/mt CFR for high-volume bookings above 60,000 mt.
“The pellet export market remains very robust, even though deals above the $200/mt mark were not reported in the market recently. Chinese mills have increased average deal volumes, reflecting a positive outlook for the process of increasing blast furnace output with higher grade concentrate and pellets as feedstock, with the focus on improving productivity,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“We hear supplies from leading originating countries like Brazil are tightening. Hence, in view of this, mills in China are increasing volumes of restocking ahead of the holidays next month. At the same time, pellet producers have been able to increase local sales realizations by at least INR 1,000/mt ($13/mt) to around INR 9,000/mt ($121/mt) ex-plant Odisha, resulting in comparatively lower export allocations by some producers,” he said.
For example, sources said that an Odisha-based pellet producer has reported a high volume booking of 75,000 mt for March shipment at $175-180/mt CFR.
Brahmani River Pellets Limited (BRPL) reportedly also concluded a high-volume deal for 60,000 mt for March at $180-185/mt CFR, trade circles said.
However, apart from sellers offering aggressive volume discounts, comparatively lower volumes on offer for high grade pellet with alumina content less than three percent have continued to be booked at higher prices. A pellet producing arm of Essel Mining reported a deal for 30,000 mt at a price of around $190-195/mt CFR, sources said.