- Absence of trades continues to persist
- Fall in iron ore export prices weighs on domestic market
- Drop in sponge CDRI prices have also put pressure on prices
Domestic low-grade iron ore fines (Fe 57%) prices remained unchanged this week in Karnataka’s Bellary. BigMint’s weekly index for low-grade iron ore fines (Fe 57%) stood at INR 3,800/t ($46/t) ex-mines Bellary, stable, w-o-w.
The absence of trades amid bid-offer disparities and weak sponge iron (CDRI) market sentiments collectively weighed on Karnataka’s low-grade iron ore prices, BigMint noted.
“3-4 miners in the region have exhausted their ECs and not much deals are being reported in the domestic market”, mentioned a Bellary-based miner.
“Domestic prices have not been impacted by the NMDC recent price hike unlike high-grade ores. Also, fall in export prices might weigh on domestic prices in the coming weeks”, another Bellary-based miner said to BigMint.
Rationale:
- No trade was recorded in this publishing window and was accorded 0% weightage.
- Five (5) indicative prices were reported, out of which four (4) were considered as T2 trades receiving 100% weightage.
Factors weighing on low-grade market:
- Low-grade export prices fall w-o-w: BigMint’s weekly Indian low-grade iron ore fines (Fe 57%) export index decreased by $5/t w-o-w to $86/t FOB east coast on 1 February, 2024. The seaborne market of Indian low-grade fines remained sluggish this week amid a lack of interest from buyers in the absence of active bookings. Drop-in futures and global iron ore prices also discouraged market confidence. As per sources, most of the Chinese mills almost completed re-stocking for iron ore ahead of the Lunar holidays, so buyers remained cautious about booking material at higher offers amid low steel margins and production.
- Drop in sponge CDRI prices w-o-w: Bellary sponge iron (C-DRI) prices dropped w-o-w on 1 February, 2024 by around INR 250/t ($3/t). Prices fell on lack of buying enquiries in the spot market. As a result, suppliers in various regions of the country reduced their offers.
Karnataka iron ore sales scenario (26 Jan-1 Feb’24)
Outlook
Domestic low-grade iron ore prices and trades in Karnataka may gain clarity with deals expected in the coming weeks.