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Karnataka: Low-grade iron ore prices remain stable after NMDC price rollback

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Fines/Lumps

BigMint Bureau

185 Reads

19 Sep 2024, 19:53 IST

Karnataka: Low-grade iron ore prices remain stable after NMDC price rollback

NMDC rolls over iron ore prices

NMDC's Donimalai auction fetches active response

Sellers expect price recovery in the near-term

Domestic low-grade iron ore fines (Fe 57%) prices remained flat this week in Karnataka's Bellary region. BigMint's weekly index for low-grade iron ore fines (Fe 57%) stood unchanged at INR 2,650/t ($32/t) ex-mines Bellary (excluding taxes), stable w-o-w. Similarly, the Fe 62% fines index was assessed at INR 4,500/t ($54/t) ex-mines Bellary, including taxes. However, a few higher offers were reported at INR 5,200/t ($62/t), attributed to constrained supplies of high-grade ore due to the monsoon season. Despite these higher offers, no deals were concluded at these levels, as buyers have yet to accept the increased prices.

National Mineral Development Corporation's (NMDC's) decision to roll over iron ore prices, along with need-based procurement and material shortages caused by heavy rains, has helped sustain domestic prices. A Bellary-based buyer told BigMint, "Heavy rains have hampered iron ore mining, leading to a raw material shortage. The quantity offered by miners has also dropped drastically."

Meanwhile, the market is waiting for another NMDC auction from its Donimalai mines to get better price clarity. The miner is set to auction around 12,000 t of lumps (10-40 mm, Fe 59%) and 36,000 t of fines (Fe 59%) on 23 September, 2024. Prices are yet to be declared by the company which will include royalty, DMF and NMET.

Rationale:

Zero (0) trade was recorded in this publishing window, receiving a 50% weightage.

Eleven (11) offers and indicative prices were reported, out of which ten (10) were considered as T2 trades. Hence, accorded with a 50% weightage.

Market highlights:

NMDC rolls over iron ore prices from Donimalai: NMDC Karnataka announced list prices of iron ore on 13 September, 2024 from its Donimalai mines. Revised prices of fines (-10 mm, Fe 59%) and lumps (10-40 mm, Fe 59%) remained unchanged at INR 3,300/t ($39/t) and INR 3,809/t ($46/t), respectively. Prices include royalty, DMF and NMET. Meanwhile, miners' auction on the same date fetched active response. 32,000 t of fines (Fe 59%) were booked at INR 3,320/t against base price of INR 3,300/t while 8,000 t of lumps (10-40 mm, Fe 59%) were booked at INR 4,109/t against the base price of INR 3,809/t. Prices include royalty, DMF, and NMET. Bid prices for fines and lumps were higher by INR 20/t and INR 300/t, respectively.

Bellary C-DRI prices stable w-o-w: Sponge iron (CDRI) prices in Bellary, Karnataka remained unchanged w-o-w. The improvement in semi-finished prices has kept sponge prices supported, sources informed BigMint.

Karnataka iron ore sales scenario (13-19 September, 2024)

Outlook

Domestic low-grade iron ore prices are likely to remain volatile, with uncertainty in price movements. However, market sentiments are expected to improve post-monsoon in the region, one of the sellers told BigMint.