Seaborne iron ore pellet premium continues falling this week, followingfines’ price trend, and some mills were using lesser percentage of pellet as feedstock.
The spot blast furnace pellet premium to the 62% Fe Iron Ore Index assessment at $49.15/dry mt CFR North China on Wednesday, down$4.25/ dmt from last Wednesday, afteradjusting to a 65% Fe basis.
The 64% Fe blast furnace pellet was assessed at $109/dmt CFR North China on Wednesday, down $12.0/dmt week on week. The premium was assessed at $43.40/dmt CFR North China, down $4.15/dmt week on week.
As steel margins have fallen significantly in the past two weeks, so has demand for high-grade iron ore.
Many mills are trying to reduce the usage of pellets, replacing it with lower grade iron ore, adding that environmental control from the Chinese government is also unlikely to boost pellet demand, as cost is an important concern.
We heard from market sources that 64% Fe Indian pellet was traded at around $109/ dmt cfr China for Mid-December loading.
The 65% Fe pellet premium was normalized to typical specifications of 0.35% alumina, 5% silica, 0.02% phosphorus and 0.003% sulfur. Physical properties specified by the assessment are 250 cold crushing strength, and a maximum size of 2.5% under 5 mm.
The 64% Fe pellet premium wasnormalized to typical specifications of 2.7% alumina, 3.5% silica, 0.08% phosphorus,0.08% sulfur, 230 CCS, and a maximum size of 5% under 5 mm.
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