Indian
iron ore export offers for high grade
iron ore fines (with Fe content of 63.5 percent and higher) have moved within a narrow range of $1/mt and settled at $41-42/mt CFR China as marginal gains during the past week have failed to be sustained, with restocking by Chinese mills being too weak to provide adequate support for offers, traders said on Friday, January 29.
"Restocking by Chinese mills ahead of the Chinese New Year was expected to provide support. However, the support was too short-lived for gains in offers to hold," an Odisha based miner-exporter said.
"Buyers were not willing to increase their stocks and deliveries ahead of the holidays. The much-anticipated momentum early in the week has not been maintained, with buyers starting to pull out even as offers inched up," the miner-exporter said.
"Local offers can at best move sideways from current levels. Worse, given the bearish fundamentals of steel prices, the rise in inventories at Chinese ports and the holidays next month, a sub-$40/mt level is also a distinct possibility," he added.
Sources said that local market sentiment has also been impacted by indications from the government that it will not consider any reduction in the 30 percent export duty on
iron ore shipments in the forthcoming national budget next month.
This, together with traders representing Chinese steel mills out of the market next month, local offers currently have a significant downside potential, the sources added.