India: Essar Steel Concludes 50,000 MT Pellet Export Deal

After observing a pause in Indian pellet export market, this week observed a trade deal. Essar Steel has recently concluded a pellet export deal for 50,000 MT pellet with grade Fe 64% content and 2.6% alumina. As per the sources, the deal was concluded at around USD 112/MT, CFR, China and the material is for Dec Loading.

Amid less strict norms, Chinese steel mills have preferred to purchase fines rather than going for high priced pellets. Global spot iron ore fines (Fe 62%) prices down sharply yesterday (30th Nov'18) by 13% to USD 65/MT, CFR China as against USD 75/MT, CFR China beginning of last week. Domestic pellets availability is also factor for showing less interest to import.

Prior to this, east India based pellet maker-Brahmani River Pellets concluded two pellet export deals to China 2 weeks back. Each vessel carries a quantity of around 61,000 MT pellets of grade Fe 64% & 2.75% alumina. As per sources, the deal was concluded at around USD 120/MT, CFR China.

Indian pellet export prices have come down by USD 35/MT in last 3 months.

Spot pellet premium plunge further

Spot pellet premium for Fe 65% grade pellets assessed at USD 48.15/DMT, CFR China this week, down by USD 5.25/DMT W-o-W against USD 53.4/DMT a week before. On monthly basis, premium pellets comes down sharply by USD 23/DMT.

Indian pellet exports in FY19

According to the vessel line up data maintained with SteelMint, Indian pellet exports for the month of Oct'18 witnessed a decline of 22% M-o-M to 0.74 MnT, as against 0.95 MnT in Sept'18. Essar Steel pellet exports up almost two-fold in the month of Oct'18 at 0.11 MnT.