Following significant fall in Indian domestic sponge prices, the fresh export offers fell by USD 5-10/MT as against last week. In last 3-5 days, the domestic sponge iron prices slump by INR 500-800/MT (USD 7-12), as per assessment made by SteelMint.
The current offers for exports of sponge iron (FeM 78-80) is hovering at USD 320-325/MT, fall by USD 5-10/MT as against last week assessment at USD 330/MT CNF Chittagong, Bangladesh.
As per exporters, negotiations are on and routine deals may soon take place as offers are cheaper compared with the imported scrap which is to be around USD 350/MT CNF Chittagong for Shredded grade. The prices are more or less firm as per assessment.
In the last week, decent deals were reported for sponge iron at the price range of USD 330/MT, hence assumptions are high for strong demand this week too.
On an average India’s monthly sponge iron exports to Bangladesh is close to 30,000-40,000 MT, which was in Jan’19 recorded at around 44,743 MT, more or less firm as against 44,878 MT in Dec’18, as per provisional data available with SteelMint.
Bangladeshi mills are largely melting scrap either imported or domestic to produce steel and the sponge iron melting proportion is less than of 5%, as per mills. Hence the nation is largely depend on scrap imports.
According to vessel line up data maintained with SteelMint, Bangladesh bulk scrap imports marked drop of 88% to 29,550 MT in Feb’19 as against a record high of 236,783 MT in Jan’19. It seems sufficient amount of scrap inventories imported in the previous month (Jan’19) could have resulted in lowered scrap import volumes in Feb’19.
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