SteelMint’s weekly low-grade Indian iron ore fines (Fe 57%) export index fell by around $6/t this week and is currently assessed at $94/t FoB east coast India. Few deals were concluded at the beginning of this week. However, with sharp plunge in today’s spot iron ore market, bids have fallen sharply resulting in trades coming to a standstill.
Confirmed trades – Three confirmed trades were reported early this week from Odisha based miners and traders with a total quantity of 165,000t fines (Fe 57%) for end Feb-early Mar’21 shipment. The deals were were concluded at $112-113/t CFR China.
- However with plunge in price today, bids fell to $103-104/t CFR China towards day close. Freight rates have also increased owing to less availability of vessels and increased demurrage rates. Freights from east coast of India to China for Supramax vessels have increased from $14 levels last week to $15-17 this week.
- Buyers from China are not interested to book cargoes in the next few days ahead of the spring holiday starting next month, as they are holding sufficient stocks.
Price indicators – Three deals have been confirmed so far in this week. Hence it was considered for index price calculation under T1 deal and given 50% weightage .
- However, one deal unconfirmed heard at around $115/t CFR, China at the beginning of this week.
- SteelMint has received eight (8) indicative prices and offers during the publishing window, and all were considered for price calculation as T2 inputs, with an average price of $92/t FoB India.
Rationale: The index has been calculated using an average of T1 and T2 price inputs. Transactions confirmed by either a buyer/seller are designated as T1 input while bids, offers, and indicative prices are designated as T2 inputs. Both T1 and T2 categories of inputs carry 50% weightage each in price calculation for FOB price assessment.
Market highlights –
- Spot iron ore fines price decreased sharply by $9/t – Chinese spot iron ore fines (Fe 62%) index decreased by around $9.35/t on a daily basis today and stood at $156.2/t CFR China against $165.55/t yesterday. On a weekly basis prices were down at around 14/t against a week before.
- Iron ore futures decreased sharply- Dalian iron ore futures’ contract of May’21 closed at RMB 985.5/t today against RMB 1,061/t last week.
- Iron ore stocks at Chinese ports increased – Iron ore inventory at major Chinese ports has increased further by 0.7 mn t to 126.2 mn t as per data maintained by SteelHome.
- SteelMint’s assessment for Indian low-grade iron ore fines (Fe 57%) this week up at INR 3,800-4,000/t (ex-mines, incl. Royalty, DMF and NMET).
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