Offers for Kumba lump from South Africa are at USD 67-68/MT, CIF West Coast for immediate delivery. Last week the offers were assessd at USD 68-70/MT, CIF India.
A market participant based in western India shared, “Steel mills in Gujarat are seen preferring both domestic pellet as well as imported ore. Current offers for Fe 63% pellets are at INR 5,350/MT, delivered Kandla. And quite a considerable amount of material (South African Kumba lump) is lying at Port which is being offered at USD 67-68/MT, CIF India.
Although fresh imports were not seen in this month at Kandla Port, a vessel was heard to be booked by a steel mill which is expected to arrive next month. It was heard to be booked at USD 66-70/MT, CIF West Coast. Lump premium has fallen further this week, which might make imported iron ore offers cheaper in the near short term, he further added.”
Till date, India has imported 69,600 MT iron ore in this month via three shipments. All shipments were made from South Africa. It is expected that the imported quantity would entirely comprise of lump. No other shipment is at anchorage or expected to arrive by the end of this month. Thus total iron ore imports to India in Aug’15 might remain around the same quantity (i.e. 69,600 MT). India has imported 2.8 MnT iron ore in first five months of this fiscal (till 27 Aug’15).
Till 27 Aug’15
Importers also seen preferring Assmang lump ore
Offers for Assmang lump from South Africa are in the range of USD 67-68/MT CNF India. Lump ore from Assmang’s mines of South Africa contains Fe 65% minimum with size ranging between 6-20 mm. Indian importers are showing little buying interest amid INR depreciation as well as cheaper availability of the ore in the domestic market.
Assmang mines of South Africa produces approximately 13-14 MnT iron ore every year, out of which it exports around 11-12 MnT.
Spot lump premium falls further
Iron lump premium which was at USD 0.1375/dry MT unit has witnessed a further decline by 13% W-o-W and is at USD 0.12/dry MT unit. Thus, it seems that imported iron ore offers to India might fall further.
Steel making activity in China generally picks up pace in Sept’15, but looking at the current scenario the situation looks quite tough. The upcoming parade at Bejing has reduced the operations of major steel industries over there especially in Hebei. This might lead to increase in iron ore stock at ports, which may turn spot iron ore prices weaker.
Leave a Reply