India: Odisha iron ore fines index rises by INR 300/t amid OMC's auction bids

• OMC sells 2.4 mnt of iron ore in September auction
  
  
• Market sentiments expected to improve next week
  
  

A miner said: "We sold some material at previous offer levels earlier this week. However, we have paused sales following the OMC auction and will adjust our offers within the next two to three days, in line with market sentiment. Buying interest is expected to increase after the positive bids seen in the auction."

According to sources, private miners are expected to increase their offers for iron ore fines by INR 250-300/t in the coming days. However, offers for the larger-size ore (lumps) are likely to remain stable, as the weighted average bids in the OMC auction have remained largely unchanged. The price trend should become clearer in the near future.

Rationale:

• T1 - Four (4) deals of Fe 62% fines were recorded from the OMC auction in the publishing window. As a result, three (3) of this were considered for price computation. This was given a 50% weightage for index calculation.
  
  
• T2 - BigMint received fourteen (14) offers and indicative prices under T2 offers, indicative, and bids in this publishing window. Eight (8) were taken into consideration and given a 50% weightage. To check BigMint's iron ore assessment, pricing methodology, and specification document, click here.
  
  

Market highlights:

• Pellet prices remain range-bound w-o-w: Pellet (6-20 mm, Fe 62.5%) prices in Odisha's Barbil fell by INR 200/t ($2.5/t) w-o-w. The current assessment stands at INR 6,800/t ($81/t) loaded to wagon. Pellet (Fe 62.5%, 6-20 mm) prices in Durgapur remained stable at INR 7,700/t ($92/t) exw on 20 September. BigMint's India pellet (Fe 63%, 3% Al) export index (FOB east coast) remained largely stable w-o-w at $84/t on 20 September.
  
  
• Fines export prices remain largely stable w-o-w: BigMint's weekly Indian low-grade iron ore fines (Fe 57%) export index inched down by $0.5/tonne (t) to $53/t w-o-w FOB east coast on 19 September 2024. The discount level remained similar to last week's 20-23% on the global fines index. No other deals were reported from India in the seaborne market as major exporters chose to be cautious instead of selling at current prices, fearing potential losses in the current trading window.
  
  
• Sponge iron prices rise w-o-w: BigMint's assessment for sponge iron C-DRI (FeM 80%) prices in Rourkela increased by INR 800/t ($10/t) w-o-w to INR 26,500/t ($317/t) on 21 September. Meanwhile, steel billet (100*100 mm) prices in Rourkela also rose by INR 500/t ($6/t) w-o-w to INR 37,000/t ($443/t) today.
  
  

Outlook

Iron ore prices in the Odisha region are expected to rise next week, as major miners are likely to increase their offers for new orders. However, the supply of iron ore remains insufficient to meet demand, with many other miners holding limited stocks for new transactions.