India: BigMint's iron ore fines export index rises $6/t w-o-w on active deals

• Discount narrows to 17.5-19% for Fe57% fines
  
  
• Prices expect to remain bullish in near term
  
  

Indian iron ore export prices rose w-o-w, driven by improved trade activity and supportive demand in the seaborne market for February delivery cargo. Market sources said deals concluded this week at a 17.5-19% discount on the global fines index, with additional negotiations underway. This bullish trend has raised optimism among Indian exporters.

BigMint's bi-weekly Indian low-grade iron ore fines (Fe 57%) export index rose by $6/t w-o-w to $66/t FOB east coast, India, on 16 January 2025. Around 165,000 t confirmed deals were recorded in the export market in this publishing window at the price of $74-76/t CFR China.

Odisha-based miners sold 4-5 Supramax iron ore cargoes of Fe57% fines at discounts of 17.5-18%, though official confirmations are awaited. Miners are now targeting $80/t CFR for new deals, while traders' offers were heard at around $78/t CFR.

A miner commented: "We have ready-to-load cargo, and if the export price improves by $3-4/t, we will initiate further deals. The exporters concluded aggressive deals in the last one week with narrowing discounts."

Chinese mills are expected to increase their purchases of Indian iron ore, especially low- to mid-grade fines, after the Lunar New Year to control steel production costs. Additionally, traders in Southeast Asia are showing increasing interest in Indian iron ore fines, which is further contributing to the upward trend in prices.

Chinese spot prices, futures rise w-o-w: The benchmark iron ore fines index increased by $4/t w-o-w to $101/t CFR China on 15 January. Transaction volumes were limited, as most mills have finished their procurement, though some seaborne trades continued. As per reports, the market expects steel production to recover after the Lunar New Year, which may support prices in the near term.

Iron ore futures on the Dalian Commodity Exchange (DCE) for the May 2025 contract rose by RMB 42.5/t ($6/t) w-o-w to RMB 797/t ($109/t) on 16 January. Furthermore, d-o-d, prices increased by RMB 14.5/t ($2/t).

A trader informed, "Chinese mills are actively procuring fines to lower production costs, signalling strong demand post-holidays. We expect the price trajectory to remain northward with increased activity in both the Chinese and Southeast Asian markets."

Price indicators

• Three (3) deals were reported in this publishing window and two (2) were considered for price calculations. Therefore, T1 trade was given 50% weightage in the index calculation. For the detailed methodology, click here.
  
  
• BigMint received twenty-one (21) indicative prices in the current publishing window, and sixteen (16) were considered for price calculation as T2 inputs and given a 50% weightage.
  
  

Outlook

According to BigMint's analysis, iron ore export prices are expected to remain bullish in the near term with a few more trades to be concluded in the coming days. Those who are waiting for improved prices compared to the current level may sell their cargo next week.