- Only need-based deals concluded in market
- Steelmakers defer aggressive restocking plans
Iron ore prices in Odisha remained largely stable this week amid moderate buying interest and trade based on immediate requirements. Miners maintained their offer levels, indicating a wait-and-watch approach in the face of subdued inquiries and limited fresh bookings.
Price and deals
BigMint’s Odisha iron ore fines (Fe 62%) index inched down by INR 50/t ($0.5/t) w-o-w at INR 5,050/t ($59/t) ex-mines on 7 June. Notably, deals of around 100,000 t of iron ore (fines and lumps) were recorded by BigMint in Odisha, which were concluded at lower prices this week.
Higher-grade deals were limited in the market due to a lack of material available.
Market updates
According to sources, “No aggressive buying was seen in the market. Most of the buyers only purchased to cater to immediate demand, especially from sponge iron and billet producers.”
Some miners dispatched orders booked previously, with limited fresh deals being concluded. Steelmakers are reportedly deferring restocking decisions, as they anticipate further price clarity. The recent decline in sponge iron and billet prices weighed on sentiment, prompting buyers to stay cautious.
A trader informed, “Finished steel prices have fallen which is creating pressure on sponge iron producers. Naturally, this translates into lower appetite for raw material procurement.”
A buyer commented on market dynamics: “Current price levels are holding for now, but a lot depends on the outcome of the upcoming OMC auction. Everyone is waiting to see where bids settle.”
The overall scenario reflects caution, with no major shift in pricing expected until the OMC auction. Market participants suggest that if auction premiums remain moderate, it could support current prices. However, any sharp rise may disrupt the delicate balance.
For now, all eyes remain on the auction outcome as buyers and sellers alike seek clarity in a volatile market environment.
Factors affecting iron ore prices
Pellet offers stable w-o-w: Pellet (6-20 mm, Fe 62.5%) prices in Odisha’s Barbil inched down w-o-w to INR 7,950/t ($92/t) loaded to wagon. Pellet (Fe 62.5%, 6-20 mm) prices in Durgapur were unchanged w-o-w at INR 8,600/t ($101/t) exw on 30 May.
Sponge iron prices drop w-o-w: According to BigMint’s assessment, sponge iron C-DRI (FeM 80%) prices in Rourkela fell by INR 100/t ($1/t) w-o-w to INR 24,300/t ($286/t) on 7 June. Meanwhile, steel billet (100*100 mm) offers in Rourkela dropped by INR 200/t ($2.5/t) w-o-w to INR 37,800/t ($441/t) today.
Rationale
- T1- Two (2) deals for Fe62% fines were recorded in the publishing window, and considered for price computation and given 50% weightage for index calculation.
- T2 – BigMint received twenty (20) offers and indicative prices under the T2 category (offers, indicative, and bids) in this publishing window. Fourteen (14) were taken into consideration and given 50% weightage. To check BigMint’s iron ore assessment, pricing methodology, and specification document, click here.
Outlook
Iron ore prices are expected to remain rangebound with further clarity on trades and offers likely to emerge after OMC’s auction. Only need-based trades are expected in the near term.
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