India: BigMint's iron ore fines export index gains over $4/t w-o-w fuelled by rise in global prices

• Chinese spot, futures prices increase w-o-w
  
  
• Deal volumes remain subdued amid higher price
  
  

India's iron ore fines prices increased in the seaborne market this week, fuelled by rises in both global spot and futures indices. However, trading volumes remained low, as exporters maintained higher asking prices. Leading traders were cautious due to market volatility and expect further price improvements as the export landscape stabilises.

BigMint's bi-weekly Indian low-grade iron ore fines (Fe 57%) export index increased by $4/tonne (t) w-o-w to $64/t FOB east coast, India, on 30 October 2024. After a considerable period, Indian sellers concluded some deals in the export market. Reportedly, an Odisha-based miner sold a 55,000-t cargo of iron fines (Fe 57%) at $78-79/t CFR China, but BigMint could not confirm this at the time of publication. Additionally, another Indian miner sold a cargo of iron fines (Fe 56-57%) at around $77-80/t CFR China this week.

A few market players reported discounts of 19-22% on the global fines index. India's domestic iron ore prices shot up following the latest auction from Odisha Mining Corporation, but this increase did not reflect proportionately in offers for related products, owing to weak market sentiments stemming from the ongoing festive period. However, market participants are optimistic about a spike in demand in the semi-finished and finished steel segments in the coming weeks.

Chinese steel mills focused on sourcing essential materials from portside and seaborne markets at favourable prices. They showed increased interest in high-grade materials, blending them with lower-cost alternatives to manage production costs and improve import margins.

Chinese spot, futures prices rise w-o-w: The benchmark iron ore fines index increased by $3/t w-o-w to $103/t CFR China on 29 October amid improved trading activity despite ongoing uncertainties. Some market participants, acting out of caution, reportedly opted for the more cost-effective higher-grade fines amid a lack of definitive information about sintering cuts from last week's environmental advisories.

Iron ore futures on the Dalian Commodity Exchange (DCE) for the January 2025 contract increased by RMB 39/t ($5/t) w-o-w to RMB 785/t ($110/t) on 30 October. On a d-o-d basis, prices rose by RMB 8/t ($1/t) today.

"Market participants are currently looking forward to the Chinese government's stimulus measures to enhance confidence and demand. For the time being, the market is waiting for clarity on demand following the festive period," an exporter commented.

Price indicators

• Two (2) deals were reported this week but were not considered, as one is still in progress and the other does not pertain to India's east coast. Therefore, T1 trade was given 0% weightage in the index calculation. For the detailed methodology, click here.
  
  
• BigMint received thirteen (13) indicative prices in the current publishing window, and eleven (11) were considered for price calculation as T2 inputs and given a 100% weightage.
  
  

Outlook

Seaborne iron ore prices for Indian material are expected to remain volatile in the upcoming days due to uncertainty regarding Chinese mills' purchasing strategies. News about sinter restrictions and the recent government meetings may also affect prices. Price improvements may follow as the export landscape stabilises.