In Dec 2013, India exported 139,500 MT Iron Pellet to China.

Exports dropped by 59.9% M-o-M in comparison to 347,800 MT exported in Nov 2013. In the current month, 88,300 MT Pellets was shipped (Provisional data till 25 Dec) from Paradip Port; the rest 51,200 MT from Gangavaram Port.

A couple of deals were finalized by Indian exporters this month

After 15 months, KIOCL concluded 50,000 MT (Fe 63) export deal with a Singapore based trader at USD 161.65/MT FoB. KIOCL received high realization of around INR 500/MT as it offered a big quantity for immediate shipment (December).

An Odisha based Pellet maker closed 30,000 MT (Fe 63) deal at INR 7,100/MT (ex plant), with a Kolkata (West Bengal) base trader. Shipment took place from Haldi Port in December. Freight from Plant to Port was around INR 1,650/MT and vessel freight at USD 20.

Exports weakened in December because of rise in freight charges and better realizations from domestic sales.

Pellet Export Market active amid Weak Rupee

Depreciated Rupee at 62 against USD has -significantly supported exports of Pellets from India, since July. Once Rupee appreciates to 58-59 against USD, exports of Pellet would not be viable.

Indian Chamber of Commerce (ICC) has written to Fin Min for imposing a ban on exports of Pellets (a 30% duty on exports) from India amid falling Iron ore production. Previous to this, Assocham had urged the Centre to impose 30% duty on Pellet and ensure Iron ore availability to domestic market and increase in DRI output.

Iron Pellet exports have significantly increased in FY14. Whereas, Iron ore production ame down 14% to in H1 FY14. According to ICC, exporters are paying no duty and misusing Pellets, when the Steel industry is suffering from low Iron ore supply.