Improved demand for high grade ore and pellets and rising iron ore prices backed by hike in futures have supported Indian pellet export prices. SteelMint’s pellet export index (Fe 64%, 3% Al, FoB east coast) has recorded a rise of around $17/t w-o-w and currently stands at $246/t.
A central India-based pellet maker has concluded an export deal for pellets (Fe 64%, 2.5% Al) via a tender process. The deal was heard concluded at around $243-245/t FoB for 55,000 t, sources have confirmed. Indian pellet export prices have rallied on the back of robust steel demand and tight availability of high-grade material in the global market.
“We had a firm bid at $254-255/t FoB India yesterday but the market is up so we are holding for now and seeking market direction,” informed a source with an eastern India based mill.
Offers for low-Al Indian origin pellets are currently heard at around $295-300/t, CFR China. However, no deals were reported till the time of publishing this report.
Rationale:
- One export deal was heard in the market. However, it was not considered because the deal was done through Vizag Port. Hence, the weightage given to it is 0%.
- Six indicative offers were received, out of which five were considered for the calculation of the index and given a weightage of 100%.
Market highlights
- Spot iron ore prices up w-o-w – The spot price of iron ore fines Fe 62% increased to $222/t, CFR China yesterday, on 29 Jun against $214.1/t, CFR China, a week ago. Iron ore futures on the Dalian Commodity Exchange (DCE) remained rangebound with a slight uptick of RMB 6/t d-o-d on 6 Jul.
- Pellet inventory up slightly on week at Chinese ports: Total pellet inventory at major Chinese ports rose by 0.3 mn t to 3.9 mn t last week, as per data maintained by SteelHome.
- Domestic pellet prices down: SteelMint’s bi-weekly domestic pellet index, PELLEX, fell further by INR 100/t to INR 15,700/t DAP Raipur, on competitive pricing from other states and decline in sponge prices.
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