Signs of slight weakness have emerged in Indian pellet export prices during the past week triggered by the cautious outlook for the finished steel market in China and indications of rising supplies from key raw material exporting countries, SteelOrbis has learned on Friday, October 23.
The limited trades during the week impacted prices which are marginally down by $1-2/mt to $130-133/mt CFR China, market sources said.
According to local pellet producers, comfortable port stocks in China, signals of a higher exportable surplus of iron ore fines from Brazil backed by rising production and shipments from Vale, and uncertainties in finished steel prices in China could weigh on ex-India pellet prices and this has been making raw material suppliers adopt a wait-and-watch stance before restocking with large volumes of raw material.
“While we do not see a large downside correction in pellet prices as Chinese crude steel production seems to be stable, at the same time the upside potential of ex-India pellet prices will also remain limited by higher shipments by global resource majors. Pellet prices hence will see sideways movements in the medium term and cautious trades as buyers will await every downturn to make bookings,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
An Essel Group company has reported a trade for 30,000 mt with a China-based trading firm for end-of-December delivery at a price of around $130/mt CFR, market sources said.
Brahmani River Pellets Limited (BRPL), the source said, concluded a transaction for 40,000 mt at $133/mt CFR China for high grade pellet with alumina content of less than two percent.