India: BigMint's iron ore fines export index rises $6.5/t w-o-w amid positive global sentiments

• Overseas discounts remained stable this week at 19%
  
  
• Around 110,000 t export deals heard from India
  
  
• Australian miner has dropped its discount for October
  
  

BigMint's weekly Indian low-grade iron ore fines (Fe 57%) export index increased by $6.5/t w-o-w at $67/tonne (t) FOB east coast on 3 October 2024. Around 110,000 t Fe 57% fines deals were recorded from India at $80-85/t CFR China were recorded in this week so far. The discount for lower-grade fines was 19% on the global fines index and remained stable compared to last week.

Indian lower-grade fines prices on the seaborne market rose following the hike in global spot, future prices of iron ore with resumption of production in northern China. However, China market observing golden week holidays for the week.

Recent macroeconomic developments are signaling positive momentum for the stability of the iron ore fines export market. On 30 Sep'24, three major Chinese cities announced plans to ease restrictions on home purchases, a move likely to boost demand in the construction sector. Additionally, the People's Bank of China is pushing financial institutions to lower mortgage rates, aiming to stimulate real estate investment and overall economic activity.

Traders said,"We have offer at $84-85/t CFR China for Indian iron ore Fe 57% cargo, but could not concluded deal yet due to Chinese holidays for the next one week."

As per Chinese sources, construction and infrastructure projects regained pace as well as demand for raw materials like iron ore is expected to strengthen, creating a conducive environment for exports.

Price indicators

• One confirmed deal was reported this week but not taken into price calculation under T1 trade and given 0% weightage in the index calculation. For detailed methodology Click here.
  
  
• BigMint received seven (7) indicative prices in the current publishing window and five (5) were considered for price calculation as T2 inputs and given a 100% weightage.
  
  

Factors supporting sea-borne market

• Iron ore spot prices sharply rise by $12/t: The benchmark iron ore fines index significantly increased by $12/t to $108/t CFR China on 3 October against 25 September following driven by positive macroeconomic news and strong trading activity. Market sentiment was lifted by the Fed's decision to cut interest rates by 50 basis points to 4.75%-5% - the first rate cut in nearly four years. Additionally, the resumption of production activities in northern China further improved the market outlook.
  
  
• Australian miner dropped discount for October: The top Australian miner dropped discount for special fines from 13.25% to 11.5% (Fe 56.5%) based on the October average of global index, while Fe 58.5 fines were also held reduced to 8% from 9% discount based on the October average of global index.
  
  

Outlook

India iron ore fines export index are anticipated to remain positive in the coming week amid strong macroeconomic developments and rising global iron ore prices. With China set to return from Golden Week, trading activity is expected to pick up, particularly as stimulus measures aimed at boosting the property and construction sectors may take effect.