- No major trade concluded from Indian sellers
- High iron ore inventory seen at Chinese ports
- Qingming festival slows down Chinese market
BigMint’s weekly Indian low-grade iron ore fines (Fe 57%) export index fell by $3/t w-o-w to $55.5/t FOB east coast on 4 April 2024. No deals were heard for standard Fe 57% fines in this publishing window amid low buying interest in the seaborne market and higher offers from sellers in the current market. Discounts have widened from 22-24% last week to 25-26% this week.
A deal has been concluded for low-grade fines (Fe 54%) at around 36% discount on the index price. However, it has not been confirmed by the buyer or seller at the time of publishing this article.
Iron ore export prices remained under pressure amid a lack of deals from India. The Chinese buyers have gone for the Qingming holidays and thus no major deals were concluded over the last few days. Sellers took a cautious stance and observed sentiments amid poor market fundamentals.
A seller from eastern India said: “There has been no improvement in iron ore export prices in the last one week and no major trades concluded from India. Most of the sellers are confused, looking at the uncertainties in the market. Some of them are optimistic that prices will rise from here while others said, prices may go below $50/t FOB India in the coming days.”
The benchmark Fe62% fines index fell by $2/t w-o-w to $99/t CFR China on 3 April. Iron ore prices remained range-bound while hitting a 10-month low as participants left the market for the Qingming festival to be held over 4-6 April. Demand for finished steel in the construction sector is still low.
An exporter said, “The Chinese market closed today amid the Qingming holiday this week and no major improvement was seen in the iron ore export prices. The miners and other exporters have to sell their material below $70/t CFR China as buyers are not entertaining their offers above this level. The current discount demanded from buyers was at around 25-26%.”
On the other hand, a few Chinese steel sources said that portside offers in China for Indian iron ore fines (Fe57%) fell by RMB 20/t ($3/t) w-o-w on 3 April before the market closed. The offers were recorded at around RMB 570/t ($81/t) at Qingdao Port, inclusive of all import taxes and port charges.
A market analyst from Singapore said that an Australian miner significantly increased the discount for lower-grade fines recently to 16.5% for April deliveries whereas the discount was 7% in March. This has encouraged buyers to lift the discount for Indian material s well. On the other hand, port stocks in China were still recorded at a higher level which reduced buyers’ interest in procuring Indian material at high prices.
Notably, iron ore inventories at China’s major ports remained largely stable at 141.95 mnt on 2 April compared to last week, according to SteelHome data.
Other highlights:
- DCE iron ore futures fall: The iron ore futures on the Dalian Commodity Exchange (DCE) for the September 2024 contract fell by RMB 9/t ($1/t) w-o-w to RMB 749/t ($103/t) yesterday. The futures dropped by RMB 19/t ($3/t) on d-o-d basis.
- India iron ore shipment rise w-o-w: India’s iron ore export shipments were recorded at 717,258 t in the third week of March, compared to 417,480 t in the second week of March, as per vessel line-up data maintained with BigMint.
Price indicators:
- No deal was reported this week for fines Fe 57% from the East Coast and not taken into consideration for calculation and was thus given 0% weightage. For detailed methodology Click here.
- BigMint received fifteen (15) indicative prices in the current publishing window and ten (10) were considered for price calculation as T2 inputs and given a 100% weightage.
Outlook
The seaborne export market for Indian iron ore fines may remain volatile amid sluggish demand and uncertainty in the Chinese market.