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SteelMint: India's pellet export index down $3/t, w-o-w, on subdued trade

SteelMint’s India pellet export index (Fe 64%, 3% Al, FOB east coast) has fallen by $3/t, w-o-w, to $147/t. Drop in seaborne iron ore prices as well as futures ke...

Pellets
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27 Oct 2021, 19:21 IST
SteelMint: India's pellet export index down $3/t, w-o-w, on subdued trade

SteelMint's India pellet export index (Fe 64%, 3% Al, FOB east coast) has fallen by $3/t, w-o-w, to $147/t. Drop in seaborne iron ore prices as well as futures kept market sentiments bearish.

The spot price of benchmark iron ore Fe 62% fines decreased by $4.8/t, w-o-w, on 27 Oct'21 to $119.65/t CFR China as against $124.45/t a week ago. DCE iron ore futures' Jan'22 contract closed at RMB 707/t ($111) (-RMB 7.5), d-o-d.

China's pellet imports witnessed a sharp decline of 71% in Sept'21 to 1.57 million tonnes (mn t) as against 5.37 mn t in Sept'20. Imports from India saw a y-o-y and m-o-m fall.

"Some tenders have been floated by eastern India-based players this week for exports, but didn't hear any deal getting concluded. With the news of increase in COVID cases in China, enquiries have slowed down a bit. Also, there have been considerable reduction in steel prices which are pressuring raw material prices", highlighted an eastern India-based source.

Last week, KIOCL concluded an export deal for 55,000 t of pellets (Fe 63% and 2-2.1% Al) via tender. The deal was heard concluded at $165/t FOB. KIOCL has signed an MoU with Glencore International AG for supply of iron ore pellets. Glencore will further supply the pellets to South Korean, European and non-Chinese markets. The MoU will remain valid for one year.

As per data maintained with SteelMint, total pellet exports from Indian ports for the week (17-23 Oct'21) were recorded 130,000 t as against nil last week.

Rationale:

  • No deal was heard to have been concluded in this publishing window. Hence, the weightage given was 0%.

  • Six (6) indicative offers and bids were received, and all were considered for calculation of the index, given a weightage of 100%.

Market highlights

  • Pellet inventory at Chinese ports down marginally, w-o-w: Total pellet inventory at China's major ports was recorded at 4.3 mn t last week as against 4.4 mn t a week ago.


  • Domestic pellet prices in India down, w-o-w: SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, moved down INR 600/t to INR 13,200/t DAP Raipur on 26 Oct. Offers were slashed sharply by pellet makers on falling sponge iron prices and muted pellet trade.

 

27 Oct 2021, 19:21 IST

 

 

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