Lesser buying interest from Chinese importers over increased iron ore inventory and decline in spot iron ore prices, Indian pellet export offers have moved down slightly this week.
According to trade sources report to SteelMint, Indian pellet export offers are presently seen at USD 88-90/MT, FoB India. Considering vessel freight from India to China of USD 9-10/MT, pellet prices would come to about USD 97-99/MT, CFR China.
Currently spot pellet premium for Fe 65% grade pellets is at USD 16.45/MT, CFR China, up by USD 1.25/MT W-o-W.
Which all factors have resulted in marginal fall in pellet export offers ?
1. Increased iron ore inventory at Chinese ports – Iron ore inventory at Chinese major ports has moved up in last few days. Iron ore inventory at Chinese major ports stood at 132.45 MnT on 24 Mar’17, up 1.1% W-o-W.
Higher iron ore cargoes with the Chinese buyers has reduced the pellet buying interest resulting in limited trade activities.
2. Plunge in spot iron ore prices in China – Spot iron ore prices in China have fallen sharply by USD 12/MT M-o-M and have recently hit two-month low. Fe 62% fines index closed at USD 80.7/MT, CFR China on 28 Mar’17.
Indian pellet exports may touch 8 MnT mark in FY17 – Pellet exports from India have gained momentum in this fiscal. During Apr-Feb’17 India exported 7.52 MnT pellets. In Mar’17 (till 20 Mar’17) India exported 0.35 MnT pellets and nearly 0.14 MnT pellet vessels are at anchorage or are expected to arrive at port by month end. Thus, it appears that Indian pellet exports will touch 8 MnT mark in this fiscal. In FY16, India exported 0.83 MnT pellets.
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