India: BigMint's iron ore fines export index rises by $3.5/t amid active export deals

• Around 300,000 t iron ore export deals from India
  
  
• Active response from buyers support market
  
  
• Bid-offer gap narrows between participants
  
  

BigMint's weekly Indian low-grade iron ore fines (Fe 57%) export index rose by $3.5/t w-o-w to $68.5/tonne (t) FOB east coast on 23 May 2024. The Indian seaborne market saw active deals in the week as buyers showed significant interest in Indian lower-grade material, driven by positive sentiments in the Chinese market.

Around 135,000 t of standard grade Fe 57% fines deals were concluded by Indian sellers in this publishing window. A giant miner from Odisha also concluded 110,000 t of Fe 54% fines at $68/t CFR China a few days back. Meanwhile, one more deal of around 55,000 t (Fe 57% fines) was also heard at $84/t CFR China but could not be confirmed by sellers.

Iron ore fines export prices have increased due to active demand from China, following recent positive macroeconomic policy changes by the government. Buyers are showing interest in purchasing Indian materials due to a significant increase in global prices for higher-grade fines and slightly better import margins for Chinese steelmakers. Miners are seeing improved margins because of lower costs, and some traders believe that a price increase of $5-7/t would be suitable for selling materials in the near term.

A seller commented: "These are decent price levels for exporting materials in the sea market. The bids from buyers have increased, and the margins have improved for the exporters. However, I still feel that some sellers expect further price hikes and await successful transactions."

Price indicators

• Two (2) deals were 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 fifteen (15) indicative prices in the current publishing window and fourteen (14) were considered for price calculation as T2 inputs and given a 100% weightage.
  
  

On the other hand, portside offers in China of Indian iron ore fines (Fe57%) increased by RMB 15/t ($2/t) w-o-w on 23 May. Offers were recorded at around RMB 680/t ($94/t) at Qingdao Port, inclusive of all import taxes and port charges. However, prices dropped by RMB 20/t ($3/t) d-o-d amid the drop in future prices and weak market sentiments during the days.

Notably, iron ore inventories at China's major ports continued to remain on the higher side at 144.65 mnt on 23 May compared to the last week, according to SteelHome data.

Other highlights:

• Iron ore spot prices up w-o-w: The benchmark iron ore fines index increased w-o-w by around $6/t to $121/t CFR China on 21 May, 2024. The market was positively affected by recent Chinese policy changes and expectations of heightened demand for steel. As per reports, market sentiment remains positive for the near future, offering additional support for ongoing iron ore prices.
  
  
• DCE futures rise w-o-w: Iron ore futures on the Dalian Commodity Exchange (DCE) for the September 2024 contract increased by RMB 25.5/t ($4/t) w-o-w to RMB 906.5 ($126/t) on 23 May. However, prices decreased by RMB 14.5/t ($2/t) d-o-d today.
  
  
• India iron ore shipments marginally up w-o-w: India's iron ore export shipments were recorded at 722,252 t in the third week of May, compared to 780,385 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 anticipated to remain supportive in the near term following the buying interest by the Chinese steelmakers.