Indian Pellet Prices remain firm over Imports Prospect

Iron Pellet manufacturers maintain domestic offers at previous week’s level because short supply in the domestic market has failed to push up prices owing to import possibility.

Although, consumers are accepting current Pellet offers, manufacturers are unable to make profits and supply the required quantity because of low stockpile.

Steelmakers’ Iron ore/Pellets demand is being met through imports supported by continual slip in Chinese spot Iron ore fines prices since the start of Q2 FY14. Fe 62% fines prices are still below USD 80/MT CNF China.

Imports have covered the domestic scarcity post suspension on mining operations in states of Odisha (9 mines) from 16 May, 2014 and Jharkhand (11 mines) from 05 Sep, 2014. India has imported 3 MnT Iron ore (including Pellets) in Apr-Sep’14. While, 1.4 MnT is likely to be imported in the 1st 3 weeks of Oct’14.

Offers for South African Iron ore lump (Fe 64%) are standing in the range of USD 93-95/MT CFR Kandla port. And, Brazilian Pellets (Fe 64%) are being offered at USD 106-108/MT CFR Kandla port.

Indian Iron Pellet Prices

**delivered to Kandla port, excluding CST
Basic prices in INR/MT
Source: SteelMint Research

East India Pellet Producers struggling for Iron Ore; JSPL in talks for Imports

Most of the Pellet producers in East India namely JSPL, Essar Steel, Bhushan Power & Steel and Arya Iron & Steel aren’t open to domestic sales, reason being either restricted production on scarcity of Iron ore or in house consumption of the produced material.

JSPL is in discussions for immediate delivery of DR/BF grade Brazilian Pellets (capsize vessel) having Fe 64% or Iron ore lump of similar grade from South Africa and other prospective countries. The company has already imported 20,000 MT Iron ore fines from South Africa, at Paradip port.

Sarda mines, JSPL’s chief Iron ore source, are non-operational on lack of EC and other necessary approvals since 01 Apr, 2014.