- NMDC’s iron ore auctions witness decent response
- Drop in sponge iron prices raises concerns
Domestic low-grade iron ore fines (Fe 57%) prices in Karnataka’s Bellary region continued to fall this week. BigMint’s weekly index for low-grade fines (Fe 57%) decreased w-o-w by INR 150/t ($2/t) to INR 2,700/tonne (t) ($31/t) ex-mines Bellary (excluding taxes).
However, the Fe 62% fines index rose w-o-w by INR 300/t ($3/t) to INR 4,800/t ($55/t) ex-mines Bellary, inclusive of taxes amid shortage of material in the region. Additionally, some offers were seen at higher levels, that is INR 5,400/t ($62/t). Despite ongoing supply concerns in the region, no deal was finalised for offers at higher level.
Meanwhile, the National Mineral Development Corporation (NMDC) has, once again, maintained its iron ore prices, providing some support to domestic prices amid selective procurement. Its recent iron ore auctions at Donimalai and Kumaraswamy mines fetched a decent response.
NMDC Karnataka’s list prices of iron ore fines (-10 mm, Fe 58%) and lumps (10-40 mm, Fe 58%) stood at INR 3,537/t ($41/t) and INR 4,224/t ($49/t), respectively, for the Donimalai auction on 18 February. List prices remained unchanged from the previous revision on 12 February. The auction witnessed bookings of 32,000 t against 60,000 t offered: 20,000 t of fines (Fe 58%) were booked at INR 3,647/t ($42/t) against the base price of INR 3,537/t ($41/t), while only 12,000 t of lumps (10-40 mm, Fe 58%) were booked at the base price of INR 4,224/t ($49/t). Prices are on ex-mines basis, including royalty, DMF & NMET.
Another auction, held on 15 February at NMDC’s Kumaraswamy mines, saw 344,000 t of material being booked: 124,000 t of lumps (10-40 mm, Fe 54.75-62.15%) were booked at INR 4,388-6,009/t ($51-70/t) against the base prices of INR 3,548-4,999/t ($41-58/t), while 220,000 t of fines (Fe 54.15-62.07%) were booked at INR 2,882-5,015/t ($33-58/t) against the base prices of INR 2,882-4,075/t ($33-47/t).
Rationale
- One (1) trade via e-auction was recorded in this publishing window and was considered under T1 trade, receiving 50% weightage.
- Sixteen (16) offers and indicative prices were reported, out of which fourteen (14) were considered as T2 trades. Hence, this category was accorded 50% weightage.
Bellary C-DRI prices drop w-o-w on lower trades: Sponge iron (CDRI) prices in Bellary, Karnataka, fell around INR 450/t ($5/t) w-o-w. Amid the price drop, booking also remained modest across regions. A lower number of inquiries were heard, as buyers showed caution in booking material amid weak steel market sentiments.
Karnataka iron ore sales scenario (14-20 February 2025)
Outlook
Domestic low-grade iron ore prices are expected to remain volatile in the region. Meanwhile, the market is closely monitoring the developments related to the MRT bill.
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