India: Iron ore concentrate prices stay firm on pending deliveries, NMDC's price hike

Iron ore concentrate prices in Jabalpur, central India, remained stable this week. Hike in Odisha iron ore prices, stability in pellet offers and lower inventories have supported concentrate prices. Meanwhile, NMDC's recent iron ore price hike announcement has also kept offers supported, SteelMint noted.

SteelMint's bi-weekly index for Fe 63% concentrate currently stands at INR 5,200/tonne (t) exw, unchanged as against the prices seen on 25 November, 2023. Meanwhile, offers were also heard at higher level of INR 5,500/t exw. However, no deal has been reported at the mentioned offer.

"We have fallen short of inventories on completing our previous orders. Hence, offers have remained firm amid active demand," a Jabalpur-based seller mentioned.

Rationale:

• One (1) trade of 20,000 t was recorded in this publishing window at INR 5,200/t exw and was accorded with a 50% weightage.
  
  
• Nine (9) offers and indicative prices were reported, out of which six (6) were taken into consideration as T2 trades, receiving a 50% weightage.
  
  

Factors supporting concentrate prices:

• NMDC's iron ore price hike announcement: NMDC, increased list prices of iron ore on 22 November, 2023, SteelMint learnt from reliable sources. The company raised prices of DR-CLO and fines by INR 200/t, effective from 22 November, 2023. The miner fixed prices of DR CLO (10-40 mm, Fe 67%) at INR 6,720/t and those of iron ore fines (-10 mm, Fe 64%) at INR 4,660/t (on FOR basis from Bacheli complex). Prices include royalty, DMF and NMET charges.
  
  
• Odisha iron ore fines prices edge up w-o-w: SteelMint's weekly Odisha iron ore fines (Fe 62%) index increased marginally w-o-w by INR 100/t to INR 5,000/t ex-mines on 25 November, 2023. The Odisha iron ore market saw hike in iron ore prices on increased iron ore and pellet export market realisations in the last few weeks. As per one buyer there is lack of clarity in the market amid increased export offers pushing the domestic price for other grades.
  
  
• Stability in pellet prices: SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, remained unchanged at INR 9,700/t DAP Raipur on 28 November, 2023 compared to the last assessment on 24 November. As per sources, Raipur pellet plants kept the offers stable amid increased iron ore fines prices by NMDC last week. However, most of the buyers remained sidelined amid the expectation of some prices being cut by pellet makers in the coming days. Buyers have enough inventory and are not in a hurry to book material.
  
  

Outlook

Iron ore concentrate offers are expected to remain supported in the near term amid supportive sentiments from pellet and Odisha iron ore market.