Indian iron ore pellet offers have continued their uptrend for the second consecutive week, riding on higher buying interest and number of deals concluded during the past week, as sintering restrictions was seen to gradually come into force on Chinese steel mills, traders said on Friday, October 11.
Market sources said that Indian pellet offers have firmed up to $108-110/mt CFR China from the level of $105-108/mt CFR China recorded earlier this week.
According to the sources, Jindal Steel and Power Limited has concluded two deals for late October delivery. One of the contracts was reportedly at $108/mt CFR China, while the second lot was traded at $110/mt CFR China. Both cargoes were for grade with alumina content less than 2 percent, the sources added.
It is also reported that Brahamani River Pellets Limited (BRPL) has concluded a deal for late October delivery at $109/mt CFR China also for grade with alumina content less than 2 percent, the sources said.
According to market reports, at least two iron ore pellet producers based in central Indian province of Chhattisgarh have returned to the export markets with offers inching towards the $110/mt mark as higher levels would offset higher logistical costs being at a distance from port. However, details of their deals concluded during the past week were not readily available in the market.
“Soon after the end of Chinese national holidays, steel mills in China were seen to be re-stocking raw materials increasing buying interest for Indian pellets. The re-stocking was significant and is expected to sustain as availability of domestic material tend to fall during winter months,” a member of Pellet Manufacturers’ Association of India (PMAI) said.
“Demand for Indian pellets is also rising as more number of Chinese steel mills is facing sintering restrictions ahead of the winter season and forecast of lower pellet production during rest of the year from global majors like Vale,” the member added.