Indian iron ore pellet prices in Chinese market increase
Published by Nicholas Woodroof,
Editor
Dry Bulk,
Argus Media is reporting that Indian iron ore pellet prices in the Chinese market increased this month, as a result of mills increasing their purchases of direct-charge material in reaction to environmental restrictions amid tight supply of Indian pellet.
Deals for 64% Fe Indian pellet in Tangshan were made at between Yn. 855-875 /wet metric tonne (wmt) this week, up by Yn. 5-25/wmt from last week. The seaborne-equivalent of the latest prices is US$115-121/dry metric tonne (dmt), assuming 5% moisture and 16% value-added tax. Indian pellet prices have also increased at Shandong ports, where a cargo was recently sold at Yn. 850/wmt.
Demand for imported pellet has increased due to frequent restrictions being imposed on iron ore fines sintering – particularly in the north of China – in order to control emissions. In addition, mills in north China are currently choosing Indian pellet because of its 64% Fe content – higher than the 63% Fe content in domestic pellet – as well as higher prices of domestic pellet in China.
Offer prices of seaborne Indian pellet are also increasing due to a shortage of pellet in India while the seasonal monsoon rains affect mining. Prices of domestic pellet in Odisha, the country's largest iron ore producing state, increased by approximately 14% from a month earlier to Rs. 6200/t (US$91/t) on 18 June, domestic brokerage Motilal Oswal Securities said. The monsoon season runs from June-September but peaks in July and August, raisining the possibility of further price rises for domestic pellet.
The majority of spot pellet supplies available in China originate from India; pellet exports from India to China increased by 5.65% from a year earlier to 9.34 million t in the financial year that ended 31 March.
A Shanghai-based trader received an offer of 62% Indian pellet with June loading dates at $110/dmt. Indian pellet usually sells on a 64% Fe basis.
Offer prices of low-alumina Indian pellet are greater than those for pellet with 3% or higher alumina content, as a shortage of low-alumina ores boosts premiums of nearly all grades of low-alumina ores in China, including BRBF fines, Assmang fines and IOCJ fines. A cargo of 64% Indian pellet with 3% alumina was offered at US$107.5-108/t, while a similar cargo with 2% alumina was offered at US$120/t earlier this month.
Read the article online at: https://www.drybulkmagazine.com/dry-bulk/22062018/indian-iron-ore-pellet-prices-in-chinese-market-increase/
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