India: Iron ore prices in Karnataka remain range-bound w-o-w in recent trades

• NMDC’s rolls over base price for auction
• Absence of deals raises concerns in market

Domestic low-grade iron ore fines (Fe 57%) prices in Karnataka’s Bellary region edged up this week. BigMint’s weekly index for low-grade fines (Fe 57%) inched up by $50/t ($1/t) w-o-w to INR 2,750/tonne (t) ($32/t) ex-mines Bellary (excluding taxes).

However, the Fe 62% fines index remained stable w-o-w at INR 4,800/t ($55/t) ex-mines Bellary, inclusive of taxes amid shortage of material in the region. Sluggish buying activity was seen in the market due to weak demand.

The National Mineral Development Corporation (NMDC) has been experiencing disruptions in production and dispatch operations over the past two to three days due to an ongoing work-to-rule protest by workers. The protest, stemming from an unresolved wage settlement dispute between trade unions and the company management, has considerably impacted operational efficiency.

Meanwhile, NMDC has once again kept its iron ore prices unchanged, offering stability to domestic market rates amid selective procurement. Recent iron ore auctions at its Donimalai and Kumaraswamy mines received a decent response.

In NMDC Kumaraswamy auction held on 11 March, 48,000 t of lumps (10-40 mm, Fe 61.61%) were booked at INR 5,171-5,181/t against the base price of INR 4,871/t and 80,000 t of fines (Fe 57.56-58.13%) were booked at the base price of INR 3,189-3,301/t . Prices are on FOR, ex-stockpile/mines basis, including royalty, DMF and NMET.

Rationale

• One (1) trade for Fe 57% fines was recorded in this publishing window and was considered under T1 trade, receiving 50% weightage.
• Twelve (12) offers and indicative prices were reported, out of which nine (9) were considered as T2 trades. Hence, this category was accorded 50% weightage.

Bellary C-DRI prices inch down w-o-w : Sponge iron (CDRI) prices in Bellary, Karnataka, fell by INR 100/t ($1/t) w-o-w. Booking volumes remained modest across regions due to a decline in prices, as buyers refrained from aggressive purchases amid uncertain steel market conditions.