India: SteelMint's iron ore export index falls amid mixed market sentiment

SteelMint's weekly Indian low-grade iron ore fines (Fe 57%) export index decreased by $2/t w-o-w to $74/t FOB east coast on 26 October, 2023. No deal was concluded this week as bid-offer disparity was seen.

The Indian iron ore export market remained sluggish this week as most of the sellers and traders were on holiday. Additionally, the market witnessed a lack of price clarity due to fewer participants. Therefore, most participants are on a wait-and watch mode currently.

As per reports, discounts for low-grade fines are expected to narrow this month due to strong buying interest as well as some demand for higher-grade fines for blending in China. However, last week a few shipments were concluded in the seaborne market.

Price indicators

• No deal of Fe57% was reported this week and not taken into calculation. Thus given 0% weightage. For methodology Click here.
  
  
• SteelMint received eleven (11) indicative prices in the current publishing window and nine (09) were considered for price calculation as T2 inputs and given a 100% weightage.
  
  

Market highlights

• Global iron ore prices rise: The benchmark Fe 62% fines index increased by $2/t w-o-w to $120/t CFR China on 25 October. Iron ore prices increased as firm demand prompted an increase in procurement activities. As per reports, the increase in seaborne prices may be linked to high utilisation rates and mills' preferences for low- and medium-grade fines. Steel mills with lower inventory are forced to restock at higher prices.
  
  
• DCE iron ore futures edge up: Iron ore futures on the Dalian Commodity Exchange (DCE) for January 2024 contract inched up by RMB 5/t ($1/t) to RMB 876.5/t ($120/t) on 26 October. Futures prices rose by RMB 4.5/t ($1/t) compared to RMB 872/t ($119/t) on 25 October.
  
  
• Iron ore port inventory in China stable: Iron ore inventory at major Chinese ports remained stable at 105.15 mnt on 19 October compared to the previous week, according to SteelHome data. Inventories have fallen to the lowest level since mid-July 2020.
  
  

India's iron ore export shipments were recorded at 320,234 t in the first week of October compared to 612,501 t in the second week, as per vessel line-up data maintained with SteelMint.

Outlook:

Low-grade iron ore offers in the export market are volatile currently. However, a few trader sources said that although buyers are there in the market, bids are lower than prevailing offers.