India: Iron ore concentrate prices under pressure amid falling pellet prices

Iron ore concentrate prices in Jabalpur, central India, remained stable this week. Drop in pellet offers amid ongoing festive season and weak finished steel market sentiments have put pressure on iron ore concentrate prices, SteelMint notes.

SteelMint's bi-weekly index for Fe 63% concentrate currently stands at INR 4,500/tonne (t) exw, stable as against the last assessment on 21 October, 2023. Some offers were also heard at a higher level of INR 4,700/t exw.

"Decreasing pellet prices are putting pressure on iron ore concentrate offers," highlighted a Jabalpur-based seller.

Rationale:

• One (1) trade was recorded in this publishing window but was not taken into consideration and given 0% weightage.
  
  
• Nine (9) offers and indicative prices were reported, with six (6) of them being considered as T2 trades and receiving 100% weightage.
  
  

Factors weighing on prices:

• Drop in pellet offers: SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, dropped by INR 200/t to INR 9,800/t DAP Raipur on 23 October, 2023 compared to the last assessment on 20 October. Eastern region pellet makers, on the other hand, offered materials in Raipur comparatively cheaper, which impacted the local Raipur pellet offers. As per sources, continuously decreasing sponge and steel prices weighed on Raipur pellet prices. Most of the market participants remained silent, as no big deal was heard so far in this week.
  
  
• Raipur billet prices fall w-o-w: Billet prices in Raipur fell by around INR 750/t w-o-w to INR 41,700/t exw on 25 October, 2023. The fall in index was mainly influenced by lower offerings in the semi-finished steel segment, particularly in the northern region market of India.
  
  

Outlook

Iron ore concentrate prices are expected to remain volatile in the near term owing to weak pellet and finished steel market sentiments.