Go to List

Export duty cloud hangs over Indian pellet export market

India’s pellet export market remains silent for yet another week after the announcement of the steep export duty of 45%. The Indian government has imposed the steep...

Pellets
By
495 Reads
1 Jun 2022, 18:43 IST
Export duty cloud hangs over Indian pellet export market

India's pellet export market remains silent for yet another week after the announcement of the steep export duty of 45%. The Indian government has imposed the steep duty from none previously with the objective to control inflation and soaring steel prices and to ensure higher availability for the domestic industry.

There are presently not many active offers from Indian players as they have adopted a wait-and-watch approach.

An Indian mill had floated an export tender for pellets (63% Fe, 8% SiO2+Al2O3). The due date for the tender was 31 May'22 and the tender had been floated only for empanelled customers. The quantity of the tender had not been specified and was subject to negotiation depending on bids received, SteelMint came to learn from sources.

The result could not be received till the time of publishing this report. A tentative price idea of $150-155/t CFR China for Fe 63% pellets, the ex-plant realization will stand around INR 4,000-4,200/t, after the imposition of the export duty, according to SteelMint analysis. On the other hand, SteelMint's domestic price assessment for the Barbil region stood at INR 8,000/t loaded to wagon. Thus, the realization in exports is much lower than in domestic.

Market highlights

  • Global iron ore prices increase w-o-w: The benchmark Fe 62% fines index increased by $6/t w-o-w on 31 May to $136.50/t CFR China. Seaborne iron ore prices rose on anticipation of improving demand because of positive import margins, particularly for medium grade fines.

  • DCE iron ore futures increase w-o-w: Iron ore futures on the Dalian Commodity Exchange (DCE) for September contract closed on 1 June, 2022 (at 3 pm) at RMB 905.5/t, increasing RMB 53.5/t ($8/t) as against RMB 852/t on 25 May, 2022. On a daily basis, prices increased by around RMB 13/t ($2/t).

  • Port inventories in China decrease w-o-w: Pellet inventory at China's major ports decreased to 4.6 mnt this week against 4.9 mnt a week ago.

 

1 Jun 2022, 18:43 IST

 

 

You have 1 complimentary insights remaining! Stay informed with SteelMint
;