Brazilian miner Vale, the world's biggest iron ore exporter, Tuesday offered a 60.14%-Fe Sinter Feed High Silica Guaiba fines cargo -- the first such offer via a spot tender in nearly 10 months -- traders who received the tender told Platts Tuesday.
Vale last offered 170,000 mt of 60%-Fe SFHG fines via a spot tender on November 27. But that shipment, which was for loading from Brazil November 29, was not awarded as the bids were deemed too low, sources said previously.
In the current tender, which closes later Tuesday, Vale is offering a 269,462 mt cargo which will pass Singapore on September 12.
Vale had offered this 60.14%-Fe SFHG cargo via the CBMX trading platform Monday at $128.70/dmt CFR China, lowering its offer to $127.70/dmt CFR China, trading sources based in China said Tuesday. But Vale was not able to sell the cargo on Monday, sources said.
One trader based Guangzhou, China, said Tuesday that the sheer size of the cargo meant it could likely only be delivered into some ports in China, such as Majiashan, Dalian, Qingdao or Zhanjiang, which could limit the scope of buyers.
China is the world's biggest importer of iron ore, and Vale's iron ore tenders are usually awarded on a fixed price, CFR China basis.
"This is a very huge shipment with high silica ores; not many buyers have the appetite for it," said the trader. "Especially not when the iron ore market is on a down trend recently."
A Shanghai-based trader who received the tender noted that given the promptness of the cargo, it could have been a term cargo that is now being offered in the spot market.
But other sources said this spot tender could be due to an increase in Vale's production, and not necessarily a rejection by any contractual customer.
"Not many steelmakers are willing to take the risk of rejecting any contractual material from miners, as they will find it hard to buy any iron ore from them again if they do so," said the Shanghai-based trader.
He also noted that not many companies are willing to buy SFHG fines, as the latter require more coking coal -- in the steelmaking process -- to mitigate the high silica content, and coking coal prices have been increasing recently.
The SFHG cargo that Vale is currently offering will contain 1.95% alumina, 8.31% silica, 0.068% phosphorus, 0.348% manganese, 2.75% loss on ignition and 8.2% moisture, sources who received the tender said.
This iron ore sell tender is the eighteen spot tender that Vale has issued so far this year, a marked change from having actively offered spot cargoes almost every single day throughout 2012, according to data compiled by Platts.