Karnataka: Low-grade iron ore market remains subdued amid absence of active offers

• Prices remain under pressure
  
  
• Lack of active offers, trades persist
  
  
• Weak export sentiments weigh on domestic prices
  
  

Domestic low-grade iron ore fines (Fe 57%) prices continued its downtrend this week in Karnataka's Bellary. BigMint's weekly index for low-grade iron ore fines (Fe 57%) stood at INR 3,050/t ($37/t) ex-mines Bellary (excluding taxes), a w-o-w fall of INR 150/t ($2/t). Prices were also heard at higher level of INR 3,500/t ($42/t), excluding taxes. However, no trades were reported at the above-mentioned levels.

Domestic prices continued to remain under pressure amid bearish market sentiments prevailing in the export market and no active trades in the domestic market. Meanwhile, miners were away from the market owing to their ECs getting exhausted towards the end of the previous fiscal year 2024 (FY'24).

"We will open offers most probably after 15 April, 2024," mentioned a Bellary-based miner.

Another Bellary-based source stated, "No offers are there in the domestic market for Fe 57 and Fe 62 grade iron ore as material is not available. Productions are yet to start."

On the other hand, BigMint's weekly Indian low-grade iron ore fines (Fe 57%) export index continued to head south by around $3/t w-o-w to $55.5/t FOB east coast on 4 April, 2024. "Domestic prices continue to fall as export index is also weak. Along with it, we are also left with zero inventories," said another Karnataka-based miner to BigMint. Iron ore export prices remained under pressure amid lack of deals from India. The Chinese buyers had gone for Qingming holidays (4-6 April, 2024) and no major deals have been concluded in recent days. Meanwhile, sellers took a cautious stance and observed the market situation amid poor market fundamentals.

Rationale:

• No trade was recorded in this publishing window and was accorded with 0% weightage.
  
  
• Fourteen (14) indicative prices were reported, out of which thirteen (13) were considered as T2 trades receiving 100% weightage.
  
  

Outlook

Domestic low-grade iron ore prices and trade in Karnataka are expected to remain under pressure owing to bearish export market sentiment. Meanwhile, the fresh EC's from the current financial year (FY'25) is expected to improve the supply side.