Steep decline in spot iron ore fines prices in China over weak steel demand has lowered Indian pellet export price assessment this week.
According to market sources report to SteelMint, Indian pellet export price assessed at USD 115/MT, CFR China. The assessment has come down by USD 3/MT W-o-W.
Towards February end, JSPL- India’s largest pellet exporter offered 50,000 MT pellet for exports for which shipment were scheduled between 1st Mar to 10th Mar’18 at around USD 118/MT, CFR China.
Iron ore fines Fe 62% fines index has decreased to USD 69.95/MT, CFR China on Tuesday (13th Mar’18) as against USD 70.25/MT towards the end of last week. In last one month’s time spot iron ore prices are down by USD 10/MT. Further, comparatively low construction activities in March amid winters have reduced steel demand, which is otherwise rendered the beginning of extreme construction activities in China.
However, the pellet premium for Fe 65% marked rise of USD 2/DMT this week at USD 44.5/DMT, CFR China against last week assessment of USD 42.50/DMT, CFR.
Pellet demand to remain strong amid extended steel capacity cuts in China
The steel production cuts in winter heating season, are now been extended for another eight months. Amidst stricter environmental norms in China, mills are expected to prefer high grade ore (pellets) as feedstock as a cost effective means for production, pushing up the pellet premiums.
Tangshan City, a major steel producing city of China, has ordered the extension of steel production cuts from 16th Mar’18 to 14th Nov’18. The production halt is between 10-15% for each mill in accordance to the distance from the center of the city.
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