Indian pellet export bookings have regained momentum after observing limited trades in the past two weeks. SteelMint’s Indian pellet export index (Fe 64% 3% Al, FoB east coast) has recorded a hike of around $9/t w-o-w and stands at $222/t. Buying sentiments in China improved with quoted offers finding an acceptance, turning Indian pellet makers active for exports. Nearly six pellet export deals from India were heard concluded recently for China, South Korea etc.
In an interesting development, Goa’s Chowgule Group’s Mandovi pellet plant has concluded an export deal recently for China, however official confirmation could not be received till the time of publishing this report. The plant has resumed operations in end Apr’21 after a gap of about nine years at 1.8 mn t plant after operations had been halted in 2012 after a mining ban was imposed in Goa and Karnataka.
Dalian Commodity Exchange (DCE) iron ore futures increased by 18% w-o-w. DCE iron ore futures Sep’21 contract closed at RMB 1,169.5 ($183/t) yesterday. Following this, spot iron ore fines index also increased.
The spot price of iron ore Fe 62% fines rose by $10.35/t to $209.10/t, CFR China yesterday, on firm demand for medium-grade fines. Sentiments in the spot market seemed to be recovering on expectations of less stringent production controls in China.
“With a decline in new COVID cases in India, few states announcing unlock measures and improved demand from China, pellet export deals from India have picked up, highlighted a trader.”
Rationale:
- Six pellet export deals were concluded in this publishing window however no one qualified for price calculation as T1 inputs and given the weightage of 0% in this index.
- Apart from trades, SteelMint has also received Ten (10) indicative prices, offers and eight (08) were considered as T2 trades and given a weightage of 100% in this index.
Key market highlights-
Freight rates inch down- Freight rates for 50,000-55,000t export vessels from east coast India (Paradip) to China down against last week around $2-3/t to $ 22-23/t.
Pellet inventories at Chinese ports increased – Pellet inventory at major Chinese ports increased to 3.9 mn t last week as previous week as per data maintained by SteelHome.
Domestic pellet prices rebound – SteelMint’s bi-weekly domestic pellet index “PELLEX ” has increased by INR 400/t to INR 15,800/t DAP Raipur. Indian pellet prices in all the key markets have recorded a significant price hike of around INR 200-1,200/t this week tracking hike in sponge prices.
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