India: BigMint's iron ore fines export index remains largely stable w-o-w

• Discount has widened to 25-27%
  
  
• Recovery in the Chinese market after holidays
  
  

BigMint's weekly Indian low-grade iron ore fines (Fe 57%) export index rose by $1/t w-o-w to $56.5/t FOB east coast on 11 April 2024. One deal of 55,000 t was heard for standard Fe 57% fines at $68/t CFR China in this publishing window. Discounts have widened from 25-27% this week.

After the Chinese holiday, iron ore export prices increased in the sea market. Indian lower-grade fines experienced a $3-4/t uptick. However, Chinese buyers are looking for cheaper materials, which has created a bid-offer disparity in the market.

A seller from eastern India said: "In the past week, prices for our materials have increased by around $3-4/t. Although we have received some inquiries from potential buyers in the sea market, the current price is still too low to finalise a deal. We await further price improvements, considering the high transportation and logistics costs involved in delivering the material from mines to the ports."

The benchmark iron ore fines index increased by $6/t w-o-w to $108 /t CFR China on 9 April. Seaborne iron ore prices rose amid improved buying interest following the recovered steel margin. However, mills are still reluctant to use high grade, opting instead for lower grade fines at cheaper offers. Market participants expect that demand might increase in the second quarter of CY24 with mills restocking more often on improving margins.

An exporter said, "The domestic iron ore prices are high and it is not viable for us to procure material and sell at the current level in the sea market. We are holding the material but still getting around $10/t lower bids against the offers which is not feasible for us to sell. Buyers demanding around 28% discount for the Indian lower grade fines".

On the other hand, a few Chinese steel sources said that portside offers in China for Indian iron ore fines (Fe57%) rose by RMB 25/t ($3/t) w-o-w on 11 April. The offers were recorded at around RMB 595/t ($85/t) at Qingdao Port, inclusive of all import taxes and port charges.

The Chinese steel mills are booking lower-grade cargo on a need basis. However, sales of steel showed some recovery after the holidays, and production margins also improved.

Notably, iron ore inventories at China's major ports remained largely stable at 141.95 mnt on 2 April compared to last week, according to SteelHome data.

Other highlights:

• DCE iron ore futures rise: Iron ore futures on the Dalian Commodity Exchange (DCE) for the September 2024 contract sharply increased by RMB 66.5/t ($9/t) w-o-w to RMB 815.5 ($112/t) on 11 April. Prices remained largely stable on a d-o-d basis.
  
  
• India iron ore shipment falls w-o-w: India's iron ore export shipments were recorded at 497,751 t in the first week of April, compared to 717,258 t in the last week, as per vessel line-up data maintained with BigMint.
  
  

Price indicators:

• One (1) deal was reported this week for fines Fe 57% from the East Coast and taken into consideration for calculation and was thus given 50% weightage. For detailed methodology Click here.
  
  
• BigMint received sixteen (16) indicative prices in the current publishing window and thirteen (13) were considered for price calculation as T2 inputs and given a 50% weightage.
  
  

Outlook

The seaborne export market for Indian iron ore fines is yet to recover from low bids. Indian export market is missing bulk deals for the last few weeks.