India: BigMint's iron ore fines export index remains supportive amid decent export deals

• Active iron ore trading activities in sea market
  
  
• Over 300,000 t low grade export deals conclude
  
  

BigMint's weekly Indian low-grade iron ore fines (Fe 57%) export index remained stable w-o-w at $66/tonne (t) FOB east coast on 9 May 2024. The Indian sea market remained supportive this week following active deals at decent discount. Moreover, active buying interest for the lower-grade ore from China was noted post-holiday.

Three deals of total of 160,000 t were recorded for Fe 57% fines at the price of $65-67/t FOB east coast in this publishing window.

An Odisha-based iron ore miner has concluded three cargo deals of Fe 54/55% at $65-66/t CFR China this week. One more deal of lower grade fines was concluded by a prominent miner at $84/t CFR China recently.

Price indicators:

• Three (3) deals were reported this week for fines Fe57% from the east coast ports, all were taken into consideration for calculation and was thus given 50% weightage. For detailed methodology Click here.
  
  
• BigMint received nineteen (19) indicative prices in the current publishing window and seventeen (17) were considered for price calculation as T2 inputs and given a 50% weightage.
  
  

The fines export deals from India concluded actively with 25-27% discount for 57% fines and 33-34% discount for below Fe 55% grade. The market participants remained optimistic for the iron ore fines in the overseas market as buyers were aggressive in purchasing material after the labour day holidays.

A trader said: "The deals witnessed an upsurge after the holidays as we were seen back to back June delivery cargo deals in the past three to four days. However, few sellers eyeing for more improvement in the buyers bids and targeting $87-89/t CFR China for a successful transaction."

Few more transactions were under negotiation but could not conclude amid bid-offer disparity.

A miner said, "Demand was good in the overseas market and trades trend also remained upwards. The seller who previously purchased domestic material at cheaper prices sold their cargo in the recent market trends. Overall market sentiments were on positive side amid improved market dynamics after holidays and some aggressive low grade material restocking by Chinese mills."

On the other hand, portside offers in China for Indian iron ore fines (Fe57%) remained largely stable w-o-w on 9 May. Offers were recorded at around RMB 655/t ($92/t) at Qingdao Port, inclusive of all import taxes and port charges.

The portside buying interest remained sluggish as steelmakers getting more profit margin in the April cargos compared to new May arrival vessel. However, the medium lower grade fines performed comparatively better import margin.

Notably, iron ore inventories at China's major ports remained largely stable at 145.1 mnt on 9 May compared to the last week, according to SteelHome data.

Other highlights:

• Iron ore spot prices down w-o-w: The benchmark iron ore fines index inched down by $2/t w-o-w to $115/t CFR China on 8 May. The spot iron ore prices dropped as buyers were still hesitant to buy at the higher price. As per report, the market witnessed an instant price spike earlier in the week, shattering earlier expectations of post-holiday restocking efforts. China's interest in portside buying dropped as market players focused on price monitoring.
  
  
• DCE futures drop w-o-w: Iron ore futures on the Dalian Commodity Exchange (DCE) for the September 2024 contract decreased by RMB 8/t ($1/t) w-o-w to RMB 866 ($120/t) on 9 May. Prices remained stable d-o-d today
  
  
• India iron ore shipments up w-o-w: India's iron ore export shipments were recorded at 769,820 t in the first week of May, compared to 622,977 t in the last week, as per vessel line-up data maintained with BigMint.
  
  

Outlook

The seaborne export market for Indian iron ore fines is likely to remain strong as export deals are concluding actively in the last three-four days. In the China domestic market, lower grade material demand was also decent. This is expected to drive Indian material prices up.