India: NMDC cuts iron ore prices by INR 350/t ($4/t)

India's largest merchant iron ore mining company, NMDC, decreased list prices of iron ore CLO (calibrated lump ore) and fines today by INR 350/tonne (t) ($4/t), BigMint learnt from sources. The company's prices are effective from 09 Jan'25.

The miner has fixed prices of DR CLO (10-40 mm, Fe 67%) at INR 7,070/t ($82/t) and of iron ore fines (-10 mm, Fe 64%) at INR 5,060/t ($59/t) on FOR basis from its Bacheli complex. Prices include royalty, DMF and NMET charges.

Factors behind price cut:

• Bid prices drop m-o-m in OMC's iron ore auction - In OMC's auction for around 1.4 mnt of iron ore fines (Fe 51-65%) on 18 Dec'24, the entire quantity was booked at INR 2,250-5,400/t ex-mines. The bids fetched premium of INR 50-1,100/t against the set base price. However, weighted average bids fell by around INR 150/t m-o-m. The miner reduced the base prices by around INR 400/t m-o-m for fines.
  
  
• NMDC CG's recent iron ore auctions receive poor response: NMDC auctioned 384,400-t iron ore from Chhattisgarh on 31 Dec'24, but only 14,600 t received bids. Bacheli: 30,100-t DRCLO (10-40 mm, Fe 67%), 215,000-t fines (Fe 64%) remained unsold, while 6,000-t Baila-sized lumps (10-20 mm, Fe 65.5%) were sold at INR 6,870/t, largely stable against base price. Kirandul: Of 133,300-t ROM (10-150 mm, Fe 65.5%), 8,600 t were sold at INR 5,920/t (base price).
  
  
• Domestic pellet index falls m-o-m: PELLEX dropped by INR 500/t m-o-m to monthly average of INR 9,700 DAP Raipur in Nov'24. and further to INR 9,200/t in Dec'24 The Raipur pellet market remained under pressure as steelmakers stayed on the sidelines, waiting for price clarity. Market participants noted a cautious sentiment driven by the recent sharp drop in sponge PDRI and steel prices.
  
  
• Indian steel index closed CY'24 at 4-year lows: The India Steel Composite Index ended 2024 stable w-o-w, up by a negligible 0.1% to 128.6 points on 27 December. The index hit its lowest in over four years, last seen in December 2020. Over the year, the index failed to lift itself beyond the mid-140s, largely inhabiting the 130-zone. In December, the index mostly remained range-bound at 128.