Ex-India pellet prices have continued to decline as the mood among buyers has worsened due to the steady weakening of demand for raw materials from mills in China in face of poor finished steel prices, SteelOrbis learned from trade and industry circles on Friday, March 29.
Ex-India pellet prices are down by $3/mt to $107-109/mt CFR China, with most market participants nearly reconciled to see them breach the $100/mt CFR mark within the next few weeks as the market is not expected to revive in the short term.
The only deal reported was for 55,000 mt by an Odisha-based pellet producer at $107/mt CFR for April shipment, the sources said.
“There are no enquiries at all. Mills in China are preferring low-alumina iron ore fines even though imported fines are now only marginally lower than ex-India pellet. With finished steel prices failing to recover, mills are extremely cautious on even marginal price differentials and hence are not looking at pellets as feedstock,” a member of the Pellet Manufacturers’ Association of India (PMAI) said.
“Most producers are carrying large inventories at plants and port stockyards, incurring high carrying costs. We see further downside risks as mills are not finding any support in the market. It will breach the $100/mt CFR mark and thereafter the pace of decline will ease,” he said.