Indian Pellet Export Market Turns Active with KIOCL Deals

Southern India based pellet maker - KIOCL has concluded two pellet export deals for 50,000 MT each for Jan 2020 loading, as per sources.

One vessel consisting of Fe 64% grade pellets with less than 2% Al was reported to be concluded at USD 111.46/MT, FoB India, shared officials.

Another vessel consisting of Fe 65% pellets with less than 1% Al. As per the sources, the deal was concluded at around USD 113-114/MT, FoB India. However, this could not be confirmed by officials at the time of publishing this report.

Towards the end of Dec 2019, KIOCL had concluded pellet export deal for 50,000 MT consisting of Fe 64% content with less than 1% alumina at around USD 111/MT, FoB India for immediate loading.

However, SteelMint Pellet export assessment for the regular grade (Fe 64% and 3% Al) stands at USD 115-116/MT, CFR China, up by USD 2/MT against last week. Other Indian pellet makers are offering pellets for exports and deals are in the negotiations stage.

As per the sources, steel mills prefer pellets over lumps in China for better cost-effectiveness. Also since December 19, steel mills in East China's Shandong province and North China's Shanxi province have been forced to obey strict production curbs because of heavy air pollution. The demand for imported pellets remained on the higher side amid winter production curbs.

According to data maintained with SteelMint, Indian pellet export volumes in CY'19 recorded at 13.01 MnT, up 59% on yearly basis as against 8.19 MnT in CY'18.