SteelMint learned from trade sources that Odisha based merchant miners are considering another increase in iron ore prices in the upcoming days. Last week, they had raised prices by INR 300/MT for both lumps and fines. This would be a 2nd successive increase in prices in a week’s time. Present trade reference prices for lump (5-18 mm, Fe 63%) is around INR 5,000-5,300/MT and for fines (Fe 63%) around INR 2,600-2,700/MT (ex-mines, including Royalty, DMF & NMET)
Which all factors are driving Odisha iron ore prices?
1. Low production and Logistic Issue- Owing to monsoons iron ore production has come down in Odisha. According to data maintained with SteelMint, Odisha iron ore production fell 25% M-o-M to 6.82 MnT in July. Amid rake availability issue still prevailing in eastern India, dispatches are also being hampered.
2. Sponge iron prices trending record high level- Eastern India (Ex- Durgapur) sponge prices (P-DRI) are increased sharply by INR 900/MT to INR 23,700/MT against INR 22,800/MT a week before. Similarly, Central Indian P-DRI prices hit 10 years high and increased by INR 1800/MT to INR 24,600/MT as against INR 22,800/MT last week. C-DRI prices for Eastern India (Ex-Durgapur) are also hovering at INR 24,800/MT as against INR 24,000/MT a week ago.
3. High Pellet Export Realizations- Most of the eastern India pellet makers are looking for exports owing to strong demand and high fetching deal in the global market. Currently, Indian export assessment is USD 136-138/MT, FoB India against USD 113-114/MT, FoB, India a month before.
Spot pellet premium for Fe 65% grade pellets assessed at USD 84.2/DMT, CFR China this week up by USD 7.35/DMT W-o-W against USD 76.85/DMT a week before.
4. Surge in domestic Pellet Prices – Less raw material availability in the Domestic market has lead to a sharp hike in domestic pellet offers which are trading around 4 years high. Durgapur pellet prices are assessed around INR 8,000/MT and that in Raipur is assessed at INR 8,500/MT (basic).
All the above factors are indicating the Odisha based merchant miners may increase iron ore prices in the upcoming days to take benefit of the current scenario.
Leave a Reply