SteelMint sources have said that the high grade iron ore demand have improved in China recently as Chinese mills want to keep their production high over very bright margins currently.
According to the SteelMint sources 3-4 shipments have already been booked by Indian exporters for Oct’17 deliveries as realizations are considered to be very high at the moment.
The low grade Indian iron ore is however being rejected by millers for its week strength and is being negotiated as low as at 43-45% discounted rates.
Meanwhile for last couple of months no low grade iron ore has been loaded for foreign buyers from Goa due to prevailing monsoon in Indian subcontinent. No quantity was shipped from Mormugao port in Goa in Jun’17 and only 59,700 MT in Jul’17.
India exported 16 MnT total iron ore between Jan- Jul’17, 65% up over the same period last year.
The demand for higher grade material, due to an increased coking coal prices have been pushing the alternative material requirement in China recently. Coking coal prices have increased and are assessed at USD 208.5/MT FoB Australia for Premium HCC.
It is believed that to curb the pollution a considerable cut in the use of Sinter, along with minimized feed of low grade ore is noticed in China and made a way for the transition to high grade material.
SteelMint Analysis for high grade iron ore fines from Odisha – According to our study, cost of export of Odisha iron ore fines (Fe 62%) to Dhamra port comes to around USD 64/MT.
|
Export of Fe 62% fines from Odisha |
||
|
Particular |
Prices |
|
|
In INR |
In USD |
|
| Fines (Loaded to Wagon including Royalty, DMF & NMET) |
1850 |
29 |
| GST@5% |
92 |
1 |
| Incl GST(I) |
1942 |
30 |
| Freight to Dhamra Port (II) |
605 |
9 |
| Port handling Charges (III) |
350 |
5 |
| (I)+(II)+(III) |
2,900 |
45 |
| Export duty@ 30%(IV) |
870 |
14 |
| (III)+(IV) |
3770 |
59 |
| Moisture @ 9% |
340 |
5 |
| Total Cost (FoB, Dhamra Port) |
4,110 |
64 |
1 USD= INR 64.03 (04/09/2017)
Source: SteelMint Research
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