Ex-India pellet prices have remained stable as trade activity has been silent due to the holiday in China and low demand from mills for higher-priced raw material going forward, SteelOrbis learned from trade and industry circles on Friday, February 16.
Ex-India pellet prices have remained in the range of $125-130/mt CFR China, but the outlook on raw material demand is negative with local market participants expecting mills in China to reduce restocking of higher-priced pellets and rely on fines, as margins from finished steel still remain weak.
“Once business activity resumes after the holidays in China, we expect renewed pressure on prices. Current prices are only ‘paper prices’ as no deals were concluded at all over the past week,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“Steel mills in China completed raw material restocking very early ahead of the holidays. They are sufficiently stocked for post-holiday operations and, with some mills slated to go into maintenance shutdowns, raw material demand, particularly for higher priced pellets, will remain muted. However, a number of Indian pellet producers are still holding back volumes in local sales, expecting export prices to rebound once business resumes in China. We will have to wait and watch if that turns into a reality,” he said.