Ex-India pellet prices continued to consolidate at higher levels but trade volumes eased during the past week on reports that mills in China were shifting to lower priced fines and local producers reduced offering facing rise in logistical costs, SteelOrbis learned from trade and industry circles on Friday, December 15.
Ex-India pellet price was up $1-2/mt to the range of $139-142/mt CFR with estimated trade volume lower than earlier in the month.
One eastern India based pellet plant of an integrated steel mills concluded a trade for 55,000 mt at $139/mt CFR, while a producer in central region reported a trade for 30,000 mt at $140/mt CFR, the sources said.
“Current prices are good for sellers but despite the rise recorded during the past week, buyers are cautious in committing high volume deals amid reports that mills in China are shifting to lower priced fines. Also raw material demand is expected to taper off during winter season in the country,” an Odisha based pellet producer said.
“Also, only port based plants are concluding deals while others in the interiors are holding back offers. For the latter, rise in logistical and transportation costs to port has increased, offsetting part of the higher export realizations and these sellers are holding back offers for further rise in ex-India prices,” he said.
According to an official with a large local mill with a pellet plant, sentiments in China had turned ‘a little dull’ ahead of the winter season and due to softening of the futures market, slight fall in margins from finished steel sales and mills turning towards more cost effective lower priced fines.
A section of exporters however maintained that there was some headroom for price increases for another week when mills in China restock ahead of seasonal holidays.