India: Iron ore concentrate prices remain stable amid supportive market sentiments

Iron ore concentrate prices in Jabalpur, central India, continued to remain stable this week. Stability in pellet prices, hike in Odisha iron ore prices and active participation in Odisha Mining Corporation's (OMC's) recent iron ore fines auction supported iron ore concentrate prices, SteelMint understands.

SteelMint's bi-weekly index for Fe 63% concentrate currently stands at INR 5,250/tonne (t) exw, stable as against the prices seen on 16 December, 2023. Offers were also reported at a higher level of INR 5,500/t exw. However, no deals were recorded at the above-mentioned offers. Few buyers have kept away amidst pending deliveries of old orders.

Rationale:

• Two (2) trades of 28,000 t were recorded in this publishing window and was accorded with 50% weightage.
  
  
• Ten (10) offers and indicative prices were reported, out of which nine (9) were taken into consideration as T2 trades, receiving 50% weightage.
  
  

Factors supporting concentrate prices:

• Active response in OMC's iron ore fines auction: OMC conducted an auction for 1.678 million tonnes (mnt) of iron ore fines (Fe 54-65%) on 19 December, 2023. The buyers participated actively in the auction, and the entire quantity of fines was booked. Bids for fines increased by INR 100-1,100/t against the bid prices of November, 2023. The miner raised the base price by INR 50-100/t m-o-m for the auction for almost all lots.
  
  
• Stability in pellet prices: SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, remained unchanged at INR 10,100/t DAP Raipur on 19 December, 2023 compared to the last assessment on 15 December amid a hike in offers. The current prices were supported by decent export offers and increased raw material costs amid some uncertainty in rake availability.
  
  
• Hike in Odisha iron ore prices w-o-w: SteelMint's weekly Odisha iron ore fines (Fe 62%) index increased w-o-w by INR 100/t to INR 5,100/t ex-mines on 16 December, 2023. Active raw pellet and low-grade fines export booking and high-grade material shortages in the market have pushed the iron ore prices in the region.
  
  

Outlook

Iron ore concentrate offers are expected to remain supported in the near term. However, fluctuation in pellet and Odisha iron ore prices might become a deciding factor.