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Jindal Steel’s iron ore pellet sales fall

10 May 2018 08:12 (+01:00 GMT)
Jindal Steel's iron ore pellet sales fall

Singapore, 10 May (Argus) — Indian private-sector iron ore pellet exporter Jindal Steel & Power posted a drop in sales in the April 2017 to March 2018 financial year, indicating a slowdown in demand from China.

Jindal's pellet sales fell by 6pc in 2017-18 to 3.09mn dry metric tonne (dmt). Chinese demand for Indian pellet has cooled, as mills step up purchases of imported pellet feed concentrate amid increased domestic concentrate availability.

The company's pellet sales in domestic and export markets had surged by 239pc in 2016-17 to 3.28mn dmt. Exports drove the increase, as China turned to India to meet a shortfall in pellet supplies after an accident shut down Brazilian mining company Vale's Samarco iron ore mine in November 2015. A fall in China's domestic pellet feed concentrate output because of environmental restrictions on mining also helped boost sales of Indian pellet in China.

But Indian pellet prices remain well supported in the Chinese market, with demand starting to show signs of a revival last month. The price of 64pc Fe Indian pellet for near-month delivery is at around $117/dmt for low-alumina cargoes, up from around $114/dmt for May-delivery cargoes. Pellet prices rose to a record high of around $127/dmt for December 2017 deliveries.

Jindal Steel produced 6.86mn dmt of pellet in 2017-18, up by 6pc from 6.46mn dmt in 2016-17. Some of the production is used by its own steel plants.

Jindal Steel is one of the two largest pellet exporters in India together with Essar Steel. Arya, Rashmi and BRPL are among the smaller pellet exporters.