SteelMint: India iron ore export index drops $7/t on rising freight rates

SteelMint’s weekly index for India’s low-grade iron ore fines (Fe 57%) exports stood at $42/t FOB east coast, lower by $7/t w-o-w. The hike in freight rates has pulled down FOB prices from India. Vessel freight rates for supramax vessels have risen from $19/DMT seen last week to $26-27/DMT this week, according to market sources.

“Price indications for Fe 57% fines are at around $65-70/t CFR China; however, no deal has been heard this week. Although a couple of deals were heard concluded last week by an eastern India-based trader”, an eastern India-based source informed.

Price indicators:

• No confirmed deal was reported in the current publishing window and hence given 0% weightage under T1 trade. Click here for methodology.
• SteelMint received two (02) indicative prices, bids and offers during the current publishing window of which all were considered for price calculation as T2 inputs and given 100% weightage.

Market highlights –

• Spot prices increase by $7/t w-o-w – The spot price of benchmark iron ore (Fe 62%) fines increased w-o-w to $145/t CFR China on 2 Mar against 23 Feb’22 at $138.05/t a week ago. Seaborne iron ore price continued to rise in the week despite continued weak seaborne liquidity in the market.
• DCE iron ore futures increase $15/t on week – DCE iron ore futures’ May contract closed at RMB 797.5/t ($126/t) on 3 Mar, up RMB 94.5/t ($15/t) against last week.
• Port inventories in China inch down – Iron ore inventory at major Chinese ports inch down to 160 mnt on 24 Feb compared to 160.95 mnt last week, as per SteelHome data.

• Domestic low-grade iron ore offers range-bound – SteelMint’s assessment for Fe 57% fines in Odisha stands at INR 2,200/t ex-mines (including royalty, DMF and NMET), stable w-o-w. Steel major JSW Steel had scheduled an auction for 833,450 t of iron ore fines (Fe 53-55%) on 01 Mar’22 from its Jajang mines in Odisha in which 296,250 t was booked at INR 1,250/t ex-mines including royalty, DMF and NMET. The miner had lowered its base price to INR 1,650/t against its previous e-auction held on 22 Feb’22 which fetched subdued response due to bid-offer disparity.