India: Iron ore concentrate prices remain supported amid active trades
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- Strong response to NMDC CG auction support offers
- Active trades continue to persist
- Drop in pellet offers might affect prices
Iron ore concentrate prices in Jabalpur, central India, continued to remain stable this week. Active response to NMDC's recent iron ore auction from its Chhattisgarh (CG) mines, along with active trades at current offers, have kept iron ore concentrate prices supported, BigMint noted.
BigMint's bi-weekly index for Fe63% concentrate currently stand at INR 5,700/t ($69/t) exw, stable, w-o-w. Meanwhile, some offers were also heard at a higher level of INR 5,900/t ($71/t) exw. However, no deals were reported at the above-mentioned offer.
Rationale:
- One (1) trade of 8,000 t was recorded in this publishing window and was accorded with 50% weightage.
- Eight (8) offers and indicative prices were reported, out of which, seven (7) were taken into consideration as T2 trades, receiving 50% weightage.
Factors supporting concentrate prices:
- Active response to NMDC CG iron ore auction: On 31 January, 2024, NMDC Bacheli had auctioned off over 100,000 t of iron ore in which the entire quantity was booked by steelmakers. Around 16,800 t of DRCLO (10-40 mm, Fe 67%), and 33,600 t of ROM (10-150 mm, Fe 65.5%) were booked at INR 8,410/t ($101/t) and INR 5,970/t ($72/t), respectively while 50,400 t of fines (Fe 64%) were booked at INR 6,100/t ($74/t). Notably, bids fetched were higher by INR 1,190/t ($14/t) in DR CLO and INR 790/t ($9/t) in fines. Prices include royalty, DMF, and NMET.
- Stability in Odisha iron ore prices: BigMint's weekly Odisha iron ore fines (Fe 62%) index remained stable w-o-w at INR 5,800/t ($70/t) ex-mines on 3 February, 2024. However, buyers resisted from booking material amid lower margins in sponge and finished steel.
Outlook
Iron ore concentrate prices are expected to remain supported in the near term amid active trades. However, falling pellet offers could become a deciding factor.
