Oversupply of iron ore from Brazilian and Australian miners as well as low prices of steel in Chinese market has resulted in the downward trend in Spot iron ore prices in China. Indian 63.5/65 fines reach $127-129/MT CFR China.
The negative trend is anticipated to continue further as a result of which buying interest is quite poor.
Weakening spot iron ore prices have influenced imported Fe% 65 Iron Pellet offers to India, which has slipped by $5/MT to $165/MT (Rs 9,050/MT considering $ = INR 54.89) CFR Kandla (landed cost Rs 1,050/MT), confirmed Indian Pellet importers based in Gandhidham, who have been offered material at this level.
In the last week of April, offers slipped from $175/MT to $170-172/MT CFR Kandla, on similar reasons.
Indian Fe% 63 Pellet is being offered at same prices i.e. Rs 7,500-7,600/MT ex works (landed cost Rs 8,800/MT) and seems to be higher, when imported prices have fallen.
Importers also mentioned, “There is lack of customers and deals due to Indian sponge iron plants running at 40-50% operational capacities and also as demand for finished products is still dull.
Low phosphorus content (0.03%) in imported material as compared to Indian Pellet (0.04%) is the major factor along with effective yield (purity level) of the finished product at 83-85% in comparison to Indian material at 80-81%, why we opt to import even at higher landed cost, by about Rs 1,000/MT”.
It is heard that World's largest Iron Pellet producer with 15 MnT annual output capacity, based in Brazil, is looking into rising demand for its high grade BF grade Pellet from Middle east countries.
Russian Pellet suppliers, currently have met with huge demand from Chinese takers, who are quite interested to procure its material.
Another Pellet exporter located in Gulf, is having low availability of its required concentrates and hence, is not offering at the moment.
And, Ukrainian based Pellet exporter has already received booking orders for about the next six month's time.
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