India: BigMint's pellet export index rises by $3/t w-o-w amid higher bids
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- Trades remain muted amid wide bid-offer gaps
- Domestic prices exceed export offers by $22/t
India's pellet export prices increased marginally w-o-w, primarily driven by slightly higher bids in a recent export tender. While this lift sparked some optimism, actual deal closures remained elusive due to wide disparities between bids and offers.
BigMint's India pellet (Fe 63%, 3% Al) export index (FOB east coast) rose by $3/tonne (t) w-o-w to $95.5/t on 23 April 2025 against the previous assessment on 16 April. No pellet export deal was recorded in this publishing window.
An exporter stated, "The seaborne paper market witnessed a slight improvement, which may boost market confidence. However, deals are yet to be concluded."
Despite the limited trading activity, the rise in export prices led to a slight narrowing of the gap between export and domestic ex-plant realisations. Domestic prices exceeded export offers by INR 1,850/t ($22/t), a slight contraction from last week's INR 2,100/t ($25/t). Pellet (Fe63%) prices in Odisha's Barbil were recorded at INR 8,150/t ($95/t) exw, firm w-o-w. Meanwhile, ex-plant realisation in exports from Barbil stood at INR 6,300/t ($74/t) exw.
However, domestic sales momentum continued to be better than export trade, making the local market a more favourable option for sellers.
Market participants noted that sellers are taking a cautious stance, preferring to hold back material in expectation of further price improvements in the coming weeks. A trader informed BigMint, "We are closely monitoring the market. If the upward momentum continues, we may see more sellers participating in export deals."
Looking ahead, sentiment in the pellet export market is expected to improve. Several sources believe that prices could see a uptick in May, which would potentially boost export volumes. Buyers are still on the fence, but a robust uptick in prices could drive better participation, commented an eastern India-based trader. For now, all eyes remain on upcoming tenders and market fundamentals.
Meanwhile, the imported market remained volatile in China, with iron ore futures and spot prices showing limited movement and lacking a clear direction. Traders held quotations steady, though room for negotiation increased due to compressed steel mill margins. Most mills maintained limited inventory, focusing on essential restocking at lower prices, which led to a dip in overall market activity. Overall, the domestic iron ore concentrate market is expected to remain stable in the near term, shaped by cautious buying sentiment and rigid demand-led transactions.
Rationale
- No confirmed deals from India's east coast were recorded in this publishing window for T1 trade. Thus, this category was not taken into consideration for today's price calculations and accorded 0% weightage in the index calculation. Click here for the detailed methodology.
- Thirteen (13) indicative prices were received, and ten (10) were considered for the calculation of the index and given 100% weightage.
Factors impacting pellet exports
Chinese iron ore fines prices stable w-o-w: The benchmark iron ore fines index remained largely stable w-o-w at $99/t CFR China on 22 April. Steel margins were under pressure, causing weaker demand for high-grade products. Although a softer US dollar improved landing margins for some items, overall demand for portside cargo remained weak, leading mills to hesitate in fully absorbing seaborne cargoes
DCE iron ore futures up w-o-w: Iron ore futures on the Dalian Commodity Exchange (DCE) for the May 2025 contract increased w-o-w by RMB 19.5 ($3/t) to RMB 727.5/t ($99/t) on 23 April. On a d-o-d basis, futures inched down by RMB 16.5/t ($2.5/t).
Iron ore pellet inventories at major Chinese ports remained largely stable w-o-w at 4.65 mnt on 17 April, according to data published by SteelHome.
Outlook
As per BigMint's analysis, pellet export offers will remain volatile, but deals may occur in the coming days amid slight market optimism.
