Indian export offers of high grade iron ore fines (with Fe content of 63.5 percent and higher) have increased by $0.7/mt during the past week to $71.80/mt CFR China, as trader representing Chinese steel mills returned after holidays improving overall activity in the market but sentiments remained cautions as indicated by only small volume transactions, traders said, on Friday, October 12.
“Improved market activity offered support to offer levels. But the market is still critically poised as a section of traders feel that levels above the $70 per ton mark could trigger a correction as indicated by buyers still preferring to conclude only low volume transactions and preferring to wait for a downturn,” an Odisha based miner-exporter said.
“A persistent concern in the local export market is buyers continued preference towards iron ore pellets or low alumina iron ore fines. At the same time, miners in Odisha are maximizing production and aggregating traders have a lot of stocks which together will put supply side pressures and limit upside of current offers,” he added.
At least two other traders said that with aggregating traders carrying an estimated 45,000 mt at port stockyards, there are reports in the markets that at least a few transactions are concluded at a discount to enable traders to reduce stocks and cut carrying costs.
They said that it is after a long time that reports of transactions at discounts emerged in the local market, and an indicator that exportable surplus was steadily rising. Discounts were said to range between $1-1.50/mt.