Ex-India iron ore pellet prices have showed tentative signs of recovery as the price fall in China was seen to be reversing, but trade has continued to remain scarce and the few successful supply contracts concluded during the past week were mostly reported from buyers in the Middle East and Europe, SteelOrbis learned from trade and industry circles on Friday, August 27.
Ex-India prices have recovered to $190-205/mt CFR China, up from levels of $185-190 CFR a week ago, but actual deals have remained negligible as demand for direct charge blast furnace feedstock is forecast to remain subdued in view of production cuts, and importers have been unwilling to build up stocks.
“There is not much change in the medium and long-term bearish demand outlook in China as steel mills will continue to look at lowering production and make do with lower-priced lumps and fines. The price uptick seen now is more of an upward correction and they had fallen too sharply earlier in the month and not because of any positive change in fundamental demand among Chinese buyers,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“Indian exporters continued to look at the Middle East and Europe to keep pushing volumes overseas. Of course, such volumes in newer markets are much lower than average shipments to China,” he added.
Only one local Odisha-based pellet plant operator reported a trade with a China-based buyer for a modest volume of 25,000 mt at around $190-195/mt CFR for end-of-October delivery.
A pellet plant operator in the central state of Chhattisgarh also reported a modest volume trade of 30,000 mt with a Gulf-based buyer at $205-210/mt CFR, industry sources said.