Participants in the seaborne iron ore pellet market expect Vale's production disruptions to push this year's prices above their previous expectations, with many unable to see any mitigating factors that could prevent such a rise.
Fastmarkets' MB 65% Fe Blast Furnace-grade pellet index stood at $141.75 per tonne cfr China on Friday February 15, up from $133.94 per tonne the previous week. Uncertain supplyOn Wednesday February 13, Australian high-grade pellet feed producer Carpentaria Resources said that with increasing supply disruptions and declining grades in the high-quality iron ore sector it expects end users to focus on increasing supply diversity and the sovereign risk to its potential supply sources.The miner said these factors will be a "significant new market pull factor for developments of its Hawsons iron ore pellet feed project" in New South Wales, Australia.Some long-term pellet contracts for 2019 have already been signed based on Fastmarkets' MB 65% Fe Iron Ore Index, however, the outlook for spot pellet prices remains uncertain. The concerns about high-grade iron ore products, especially concentrates and pellets, come at a time when Vale has flagged a potential 11 million tonnes per year supply impact on...