India: Iron ore concentrate prices fall by INR 300/t post-NMDC price cut

• NMDC cut iron ore prices for July deliveries
  
  
• Sellers drop offers post-NMDC price cut
  
  
• Monsoon to put pressure on production volumes
  
  

Iron ore concentrate prices in Jabalpur, central India, witnessed a significant drop this week. NMDC's price cut announcement along with prevailing bearish sentiments in pellet and Odisha iron ore markets continued to weigh on the concentrate market, BigMint noted.

BigMint's weekly iron ore concentrate index stood at INR 4,350/t ($52/t) exw, showing a fall of INR 300/t ($4/t) as against the last assessment on 29 June. However, buyers' bids were heard at lower levels of INR 4,000-4,100/t ($48-49/t) exw.

"We have kept our offers on hold for clarity in prices," said a Jabalpur-based seller.

Another seller from the region said, "Prices have come to their current levels now. However, we are completing our previous orders at the rates prevailing at that juncture. We are planning to drop prices to the current levels after completion of pending orders."

Rationale:

• Zero (0) trade was recorded in this publishing window, and was accorded with a 0% weightage.
  
  
• Nine (9) offers and indicative prices were reported, out of which six (6) were taken into consideration as T2 trades, receiving 100% weightage.
  
  

Factors behind drop in concentrate offers:

• NMDC cuts iron ore prices by INR 500/t: NMDC has reduced list prices of iron ore CLO (calibrated lump ore) and fines by INR 500/t($6/t), BigMint learnt from sources. The company's prices are effective from 30 June, 2024. The miner has fixed prices of DR CLO (10-40 mm, Fe 67%) at INR 7,020/t ($84/t) and of iron ore fines (-10 mm, Fe 64%) at INR 5,110/t ($61/t) on FOR basis from its Bacheli complex. Prices include royalty, DMF and NMET charges.
  
  
• Pellet prices drop marginally: BigMint's bi-weekly domestic pellet (Fe 63%) index inched down by INR 50/t ($1/t) to INR 9,550/t ($114/t) DAP Raipur on 2 July, 2024 compared to the last assessment on 28 June. The pellet market in Raipur remained moderate over the last three-four days with some improvement in buying interest amid need-based purchases.
  
  
• Odisha iron ore fines prices inch down w-o-w: BigMint's Odisha iron ore fines (Fe 62%) index inched down by INR 50/t ($1/t) w-o-w to INR 4,750/t ($57/t) ex-mines on 29 June, 2024. Iron ore fines prices in Odisha remained largely stable while lumps prices fell this week as major miners revised their prices with some drop in the offers. The trades were concluded at lower prices as buyers booked some this week.
  
  

Outlook

Iron ore concentrate offers are expected to exhibit volatility in the near term amid fluctuation in pellet and Odisha iron ore prices. Meanwhile, demand for concentrates is going to slow down amid the monsoon.