- Sellers hike offers this week
- Rise in pellets, iron ore prices support offers
- Upcoming monsoon may weigh on demand
Iron ore concentrate prices in Jabalpur, central India, witnessed an increase this week. Hike in offers amid supportive sentiments from pellet and Odisha iron ore market along with active trades have kept concentrate offers supported, BigMint noted.
BigMint’s weekly iron ore concentrate index stood at INR 4,600/t ($55/t) exw, up by INR 100/t ($1/t) as against the last assessment on 11 May. Offers were heard at a higher level of INR 4,700-4,800/t ($56-57/t) exw, up by INR 200-300/t ($2-4/t) w-o-w. However, no deals were recorded at the above-mentioned levels.
“We have done recent deal in the previous offers and now quoting increased offers amid hike in pellet offers,” mentioned a Jabalpur-based seller.
Rationale:
- Two (2) trades were recorded in this publishing window, and both were considered under T1 trade and were accorded with a 50% weightage.
- Eight (8) offers and indicative prices were reported and six (6) were taken into consideration as T2 trades, receiving 50% weightage.
Why concentrate offers have increased?
- Pellet prices rise by INR 100/t in recent deals: BigMint’s bi-weekly domestic pellet (Fe 63%) index rose by INR 100/t ($1/t) to INR 10,450/t ($125/t) DAP Raipur on 14 May, 2024 compared to the last assessment on 10 May. Godawari hiked pellet offers by INR 300/t ($4/t) for Fe 63.5% and Fe 66% to INR 11,200/t ($134/t) and INR 12,700/t ($152/t) exw Raipur, respectively on 14 May, 2024. Other pellet producers kept offers stable at INR 10,500-10,600/t ($126-127/t) exw. It was noted that buyers booked decent material last week from outside of Raipur and Odisha at competitive prices. However, material delivery is a concern among buyers from other locations.
- Odisha iron ore fines prices stable w-o-w: BigMint’s weekly Odisha iron ore fines (Fe 62%) index remained stable at INR 5,000/t ($60/t) ex-mines on 11 May, 2024. Iron ore prices remained largely stable in Odisha region but participants are feeling a bit cautious amid a drop in sponge and finished steel prices. Pellet prices in the region remained firm. However, things are looking a bit uncertain at the moment.
Outlook
Iron ore concentrate offers are expected to remain supported in the near term amid supportive sentiments from pellets and Odisha iron ore market. However, the upcoming monsoon may depress demand for concentrates. Meanwhile, market awaits OMC’s iron ore auction for this month to get more clarity on prices.