India: Iron ore concentrate prices stable amid weak market sentiments

Iron ore concentrate prices in Jabalpur, central India, remained stable this week amid a decline in pellet prices and weak market sentiments in Odisha.

SteelMint's index for Fe 63% concentrate stands at around INR 4,700/tonne (t) exw, stable as against the last assessment on 3 June. Meanwhile, buyers are expecting a further drop in offers owing to the current market situation as some bids were heard at around INR 4,500/t exw.

Rationale:

• No deal was reported in this publishing window and hence given 0% weightage.
  
  
• Seven (7) offers and indicative prices were reported out of which five (5) were taken into consideration as T2 trade and accorded the balance 100% weightage.
  
  

Factors affecting iron ore concentrate prices:

• Fall in pellet prices: SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, inched down by INR 100/t to INR 8,950/t DAP Raipur.
  
  
• Odisha iron ore fines trade muted: SteelMint's weekly Odisha iron ore fines (Fe 62%) index rose marginally by INR 100/t to INR 5,500/t ex-mines on 3 June as compared to the last assessment on 27 May. Trade activities for high-grade fines were limited at current offers as mills were hesitant given the thin margins to pellets. Most miners are holding back their offers and are currently in a wait-and-watch mode ahead of OMC's auction.
  
  

Outlook

With bearish sentiments prevailing in the iron ore market and expectations of a fall in bids, iron ore concentrate prices may come under increasing pressure.