SteelMint: Odisha iron ore fines index rises INR 100/t post OMC auction result

SteelMint’s weekly Odisha iron ore fines (Fe 62%) index rose by INR 100/t to INR 5,000/tonne (t) ex-mines (including royalty, DMF and NMET). Post OMC auction, the market has started trending upward owing to the lack of high-grade raw material availability.

Rationale:

• T1- Out of several deals in OMC, only two deals were recorded for fines (Fe 62%), taken into consideration for index calculation and given 50% weightage.
• T2- SteelMint has included five (05) offers and indicative prices under T2 trade deals in this publishing window. Of these, four (04) were taken into consideration and given 50% weightage. To check SteelMint’s iron ore assessment, pricing methodology, and specification documents Click here

Factors driving up fines index:

• Positive response in OMC auction – Odisha Mining Corporation (OMC) had scheduled an auction for 1.05 mnt of iron ore (650,000 t of fines, Fe54-64%, and 400,000 t of lumps, Fe62%) on 17 January. Around 80% of the iron ore was booked at prices which were INR 200-450/t higher than the set base prices.
• Pellet offers continue to rise – SteelMint’s bi-weekly pellets (Fe 63%) assessment stood at INR 9,700-9,800/tonne (t), loaded to wagon in Barbil, up INR 800-900/t compared to last week.
• Global iron ore prices rise on restocking needs – Chinese spot iron ore fines Fe 62% prices stood at $127/t CNF China on 21 January, stable w-o-w. The China market is witnessing an uptrend on expectations of stable demand post Lunar New Year holidays.

India iron ore prices:

Karnataka iron ore auctions receive active response – NMDC conducted an auction for 600,000 t of iron ore (fines and lumps) from its Donimalai mines in Karnataka on 18 January. Around 120,000 t of lumps (10-40mm, Fe61%-indicative) was booked at the base price of INR 3,174/t, while 480,000 t of fines (Fe59%-indicative) was booked at the base price of INR 2,464/t. Another auction for 52,000 t lumps was conducted by Sandur Manganese and Iron Ores Ltd (SMIORE) on 18 January in which 13,000 t of lumps (5-20 mm, Fe58.3-58.8%) was booked at INR 4,215-4,480/t, 3,000 t of lumps (10-40 mm, Fe58.8%) was booked at INR 3,460/t and 24,000 t of lumps (20-40 mm, Fe58.1-59.9%) was booked at INR 4,010-4,320/t (including royalty, DMF and NMET).