SteelMint’s weekly pellet export index (FOB east coast India) for Fe 64% grade has moved up further by $8.5/t w-o-w to $204.5/t in the recent deals. Three confirmed pellet export deals with a total quantity of 160,000 t were recorded by SteelMint in the last one week.
Chinese steel mills are still showing good demand for high grade raw material in order to maintain the lower-emission amid strict sintering restrictions. As far as getting decent realization in finished steel prices, mill owners in China won’t mind to use high-grade material at incremental rate. However, few buyers in China are also interested to buy port side stock for better cost effectiveness. Restocking by the mills is also expected to take place soon ahead of the approaching labour holiday between 1-5 May.
In the confirmed trade recorded by SteelMint, two were concluded from Southern India (Mangalore) and one from Eastern India based pellet maker. Southern India-based pellet maker – KIOCL has concluded around 110,000 t pellet (Fe 63.5% and Al 2-2.1%) on 15th April via tender at $205/t FOB India.
The Indian Rupee has continued to depreciate against the dollar attract exports. The rupee weakened further this week to INR 75.5/$ on escalated COVID cases.
Rationale:
- Three pellet export deals were concluded in this publishing window. Out of these, only one were taken into consideration for price calculation as T1 inputs and kept the weightage of 50% in this index.
- Apart from trades, SteelMint has also received nine (09) indicative prices, offers and bids (T2). Seven (07) were considered as T2 trades and given weightage of another 50% in this index.
Spot iron ore fines price increased sharply w-o-w- Spot iron ore fines Fe 62% price increased sharply by $15/t to $187.75/t yesterday as against $ 172.65/t a week before. On a daily basis also, prices have increased around $6.55/t yesterday on the back of restocking by the mills. Spot iron ore price jumped to a 10-year high since Feb 2011, amid concentrated demand for mainstream medium to high-grade fines from Chinese buyers.
Freight rates stable this week- Freight rates for 50,000-55,000t export vessels from east coast India (Paradip) to China remained stable at $ 16-18/t against last week.
Pellet inventories at Chinese ports increased marginally- Pellet inventory at major Chinese ports have increased to 5.2 mn t last week against 5 mn t a week before as per data maintained by SteelHome.
Domestic pellet trades in India remain slow – SteelMint’s bi-weekly domestic pellet index “PELLEX ” has decreased by INR 150/t ($2) to INR 14,550/t ($193) DAP Raipur as on 20 Apr’21 in the recent deals. Decline in sponge iron prices seen in the past few days amid Increasing restrictions on rising COVID cases followed by extended lock down in Raipur have slowed down operation of plants. The movement of trucks is also getting affected due to labour availability issues which has kept trades on the lower side.
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