SteelMint’s weekly Odisha iron ore fines (Fe 62%) index has moved up by INR 100/t to INR 4,350/t ex-mines (including royalty, DMF and NMET). As per SteelMint’s sources, a bulk deal of around 100,000 t of fines (Fe 62%) has been concluded by a Odisha-based trader at around INR 4,200/t (including royalty, DMF and NMET) this week. Moreover, recovery in pellets and sponge prices have resulted in an increase in iron ore prices.
Last week, the index has already jumped to over six-month highs, as per data maintained with SteelMint.
Rationale:
- T1- One deal was reported for this week from Odisha trade and therefore taken into consideration for the index calculation and given 50% weightage.
- T2- SteelMint received nine (9) offers and indicative prices under T2 trade deals in this publishing window. Out of which eight (8) were taken into consideration and given 50% weightage. To check SteelMint’s iron ore assessment, pricing methodology, and specification documents. Click here
Reasons behind hike in iron ore prices:
- Hike in pellets prices: SteelMint’s bi-weekly domestic pellets (Fe 63%) index, PELLEX, stood at INR 8,900/tonne (t), up by INR 350/t compared to the last assessment on 6 December, 2022. Around 55,000 t of deals were reported in this current publishing window.
- Global iron ore prices up on improved Chinese sentiments: The spot prices of iron ore in China rose d-o-d on expectations of annoucement of measures to revive the property market in the annual Central Economic Work Conference next week. Benchmark Fe62% fines prices rose by $1.70/t to $112.40/t CFR China on 9 December, 2022. Prices rose by $8 w-o-w.
- Sponge iron prices up w-o-w: SteelMint’s daily sponge iron, CDRI index was assessed at INR 31,750/tonne (t) exw-Rourkela on 10 December, 2022. Prices increased by INR 1,000/t w-o-w.
India iron ore prices:
Market highlights:
- Iron ore lumps lots receive active response in NMDC’s Chhattisgarh auction: NMDC conducted iron ore auctions from Chhattisgarh’s Bacheli mines (222,600 t, Fe64-67%, indicative) and Kirandul mines (134,400 t, Fe64-65.50%, indicative) on 6 December, 2022. According to market sources, 37,800 t of DR-CLO (Fe67%) and 10,000 t of lumps (Fe65.5%) were booked at around INR 4,301-4,311/t and INR 5,127-5,137/t, respectively (excluding royalty, DMF and NMET) at the auction from Bacheli mines whereas the remaining lots remained unsold. Bids fetched in lumps lots were higher by INR 180/t over the set base price.
- Chandrapur-based miner raises fines offer: A Chandrapur, Maharashtra-based iron ore miner has offered iron ore lumps (5-18mm, Fe 63%) at INR 7,700-7,800/t FOR Raipur and fines (Fe 63%) at around INR 4,400/t FOR Ballarshah. Lumps offers remained unchanged. However, fines offers increased by INR 500/t as compared to last week.
- Bid prices in Karnataka iron ore e-auctions rise: Vedanta scheduled an auction for the sale of around 36,000 t of iron ore lumps (10-40 mm, Fe59%) from its A. Narrain mines in Karnataka’s Chitradurga district on 9 December. According to sources, the entire material was sold at INR 3,839/t while the base price was set at INR 3,549/t. NMDC conducted an auction for 494,000 t of iron ore from its Kumaraswamy mines in Karnataka on 6 December, 2022, out of which 38,000 t of lumps (10-40mm, Fe58.19-65.24%) were booked at INR 2,197-3,324/t. The remaining 456,000 t of fines (Fe57.05-64.21%) were booked at the base price of INR 1,658-2,379/t.
Outlook:
Market participants are awaiting the auction from state-owned miner Odisha Mining Corporation Limited (OMC). Traders are expecting a hike in the base price. However, officials are yet to confirm this.
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