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India: Iron ore prices edge down w-o-w in Karnataka

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Fines/Lumps

BigMint Bureau

113 Reads

12 Dec 2024, 19:00 IST

India: Iron ore prices edge down w-o-w in Karnataka

NMDC rolls over base price for iron ore

NMDC Kumaraswamy auction fetches decent response

Domestic low-grade iron ore fines (Fe 57%) prices inched down in Karnataka's Bellary. BigMint's weekly index for low-grade iron ore fines (Fe 57%) stood at INR 3,050/t ($36/t) ex-mines Bellary (excluding taxes), down by INR 50/t ($1/t) w-o-w. Similarly, the Fe 62% fines index was assessed at INR 4,900/t ($58/t) ex-mines Bellary, including taxes, reflecting a decrease of INR 300/t ($4/t) amid absence of deals and stable low grade offers of miners.

National Mineral Development Corporation (NMDC), Karnataka, has announced list prices for its iron ore auction today from the Donimalai mines. Prices of fines (-10 mm, Fe 59%) and lumps (10-40 mm, Fe 59%) remained unchanged at INR 4,015/t ($47/t) and INR 4,728/t ($56/t), respectively. Additionally, the company's recent iron ore auctions at its Kumaraswamy mines received decent response.

"Iron ore movement in Karnataka has been at a standstill for the past four days due to a software issue in DMG. Both rake and road logistics are affected. However, it's expected that it may get normalized soon", said a Bellary-based buyer.

Bids for iron ore have remained under pressure amidst decline in sponge iron and finished steel prices, stability in low-grade export prices, and buyer hesitation amidst a highly volatile market.

Rationale:

Zero (0) trade was recorded in this publishing window and hence, accorded 0% weightage.

Ten (10) offers and indicative prices were reported, and six were considered as T2 trades, receiving 100% weightage.

Factors affecting low-grade iron ore prices

NMDC Kumaraswamy auction receives decent response: NMDC Kumaraswamy conducted an iron ore auction on 7 December, 2024 in which 48,000 t of lumps (10-40 mm, Fe 62.79%) got booked at INR 5,587/t against the base price of INR 5,477/t and 32,000 t fines (Fe 54.60-62.07%) got booked at base price of INR 2,828-4,400/t . Prices are on ex-mines basis, including royalty, DMF and NMET. Notably, bid prices of lumps were higher by INR 110/t.

Bellary's CDRI prices fall w-o-w: Sponge iron (CDRI) prices in Bellary, Karnataka, fell by INR 300/t ($3/t) w-o-w. Fall in finished steel prices have weighed on sponge CDRI prices.

Bellary's pellet prices drop w-o-w: Pellet prices in Bellary, Karnataka, decreased by INR 100/t ($1/t) w-o-w to INR 10,300/t ($121/t) exw. Weak demand as well as shortage of material have put pressure on pellet prices.

Karnataka iron ore sales summary (6 December-12 December, 2024)

Outlook

Domestic low-grade iron ore prices are anticipated to remain under pressure in the coming week, driven by subdued demand for sponge iron and finished steel. Market participants are expected to maintain a cautious approach, with trade activity likely confined to essential procurement rather than speculative buying.