Three iron ore import vessels arrived in Jan’17 and vessel booking for Feb’17 remain limited due to high global prices and subdued domestic steel prices.
Gujarat based steel makers are majorly sourcing iron ore from NMDC (Chhattisgarh), South Africa and domestic pellets from Jindal SAW. Except Essar Steel which is seen procuring iron ore fines from Odisha, NMDC (Chhattisgarh).
A Gujarat based steel maker shared “Owing to higher global prices, we haven’t booked any iron ore lump shipments. Domestic finished steel demand in Gujarat is quite dull. Though prices have increased over higher cost of production, trades remain limited. Rebar (12 mm) prices in Ahmedabad are at INR 28,500-29,000/MT (Excise Duty @ 12.5%, VAT/CST extra) which was INR 29,200/MT a month ago”.
1. Iron ore sourcing from NMDC (Chhattisgarh) remains intact – Gujarat based steel maker – Gallant Metal continue to procure iron ore lump from NMDC (Chhattisgarh) via railway movement to Vizag port and then carrying it to Kandla port via coastal vessel movement.
2. Imported iron ore from South Africa –
Few of Gujarat based steel makers imported a vessel of 89,200 MT South African lump at Kandla port. The vessel named ‘Bottiglieri Giorgio Avino’ arrived at berth on 14 Jan’17. As per market sources, the vessel has been jointly imported by Mono Steel and Welspun Steel.
Another iron ore import vessel named ‘Golden Feng’ carrying 157,500 MT iron ore (majorly fines) from South Africa arrived at Mundra port on 15 Jan’17. Market participants expect that the vessel has been booked by Jindal SAW.
Shraddha Ispat imported a vessel of 95,230 MT South African lump via vessel named ‘ Wel Success’ at Mormugao port towards the beginning of this month.
Presently prices of South African lump (Fe 64%) are assessed at USD 89/MT, CFR China. And South African fines (Fe 65%) prices are at USD 79.6/MT, CFR China.
3. Jindal SAW pellet offers – Towards the beginning of Jan’17, Rajasthan based pellet maker – Jindal SAW reduced pellet offers by INR 200/MT to INR 6,200/MT, delivered Kandla.
Sourcing from Karnataka e-auctions remained thin. Gujarat based steel maker – Electrotherm India sourced 4,000 MT lump (Fe 64% from P. Balasubba Setty & Sons) at bid price of INR 2,950/MT (basic) through the e-auction held on 01 Jan’17. Since then, no further procurement from Karnataka e-auctions by the steel maker has been noticed.
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