During week 36, pellet premium for Fe 65% BF grade pellets is assessed at USD 34.2/DMT. Pellet premium is maintaining an upward trend.
Premium has moved up by USD 3/DMT W-o-W. In Week 35, the premium was assessed at USD 31.2/DMT.
Pellet premium is also moving up as Chinese steel makers opt for high-grade pellets or lumps due to restriction on sinter usage. In addition, disruption in Samarco’s operation has also widened the gap between demand and supply of pellets in China, as a result pellet premium is moving up.
It should be noted that pellet premium was usually assessed at around USD 17-18/DMT last year, but now it is hovering at all time high levels and touched to USD 34.2/DMT this week.
Pellet inventories at major Chinese ports are at 3.6 MnT in Week 36, down by 5.2% as it was 3.8 MnT in Week 35. Seaborne pellet inventories are decreasing continuously. In week 34, inventories were recorded at 4 MnT.
Spot lump premium remains unchanged at USD 0.191/MT in Week 36
In Week 36, spot lump premium continued to remain at USD 0.191/DMT as compared to Week 35.
The ongoing G20 summit in Hangzhou is also expected to increase demand for lumps and pellets, as usage of sinter fines will be reduced or stopped. The G20 summit takes place between 31 August to 04 September.
Seaborne lump inventories at Chinese major ports were recorded at 12.35 MnT in week 36, up by 1.6% as it was 12.15 MnT in Week 35.
Leave a Reply