Indian pellet export prices drop on recent export deal concluded last week by a private pellet maker. Indian pellet exporters continue to remain active in Chinese market despite falling iron ore prices and on-going holidays in China.
SteelMint learnt from market sources that a pellet deal of around 50,000 MT has been concluded last week at an average price of USD 114-116/MT CFR China for November shipment, which is lower by about USD 4/MT ton as compared to last deal done by Jindal Steel in last 2nd week of September, before Chinese went for a week long holiday. As per market sources, the pellet maker has received highest bid at around USD 118.5/MT, CFR China.
Market participants expect more pellet offers from Indian suppliers in coming week as domestic demand remains subdued.
Indian pellets exports have increased sharply in 2017 owing to rising demand of high grade lumps and pellets in China and absence of Brazil’s one of the largest pellet maker Samarco from the market.
Indian pellet exports in first nine months of 2017 were reported at 6.74 MnT against 3.09 MnT during same period last year.
Chinese market re opens on Monday after a week long holiday. Although market carries a bearish outlook for iron ore in coming months as more steel production cuts are expected during November’17 to March’18.
Can Iron ore prices fall further?
Iron ore prices have been on a roller coaster ride in 2017. Prices peaked at USD 95/MT in Feb’17. After that, they fell to USD 53/MT in Jun’17. Shortly afterward, they started recovering, and July and August saw a significant rise in prices.
However, the prices have again started a downward trend with a 20% fall registered over the past three weeks or so. For the week ended September 22, 2017, the prices retreated 12%, posting their biggest weekly loss in the last 16 months. Iron ore prices are currently around USD 64/MT. The most recent fall in the steel-making ingredient was due to expectations of a fall in Chinese steel demand as authorities tighten credit conditions.
Iron ore prices have fallen into bear territory once again. As China gets ready to cut its steel capacity for four months on November 15, 2017, the outlook for the main steel-making ingredient has turned bleak.
Several big research houses have projected iron ore prices to fall in the range of USD 50-55/MT in coming time.
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