Indian iron ore fines export activity picks up amid revived restocking by Chinese steel mills

Friday, 18 January 2019 17:31:45 (GMT+3)   |   Kolkata

Indian export offers for high grade iron ore fines (with Fe content of 63.5 percent and higher) have surged  by $2.20/mt week on week to $74.35/mt CFR China on the back of a revival of buying activity in view of the approaching Chinese New Year holiday and restocking by steel mills, traders said on Friday, January 18.

“There has been a greater number of active buyers in the market than in the previous several weeks, leading to an improvement in sentiment and in the number of transactions concluded during the past week,” an Odisha-based miner-exporter said.

“While both miners and aggregating traders reported concluding transactions, most transactions volumes have been on the lower side indicating that buyers are still cautious about concluding transactions at the higher levels, which may not be sustained until the Chinese New Year next month,” the miner-exporter added.

Market sources said that the strengthening of futures contracts has provided additional support for physical trades even though volumes have not indicated a significant surge.

The sources said that most Indian market participants are unsure to what extent the current restocking by Chinese steel mill will gain momentum ahead of the holidays, with a section of the market claiming that upside potential will be limited as, with finished steel prices still to bottom out, Chinese steel mills will remain cautious about building up excessively large raw material inventories.

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