SteelMint: Iron ore fines index rises marginally on tighter availability of high grade ore

• Limited availability of high-grade ore (above Fe 62%) in Odisha worries buyers
  
  
• Bids for high grade lumps in NMDC (C.G.) auction rise by over INR 1,000/t
  
  
• Goa govt to put 1.63 mn t iron ore for auction on 24 Mar'21
  
  

SteelMint's weekly index for Odisha iron ore fines (Fe 62%) has increased by INR 100/t this week to INR 5,250/t (ex-mines, including Royalty, DMF & NMET). High-grade iron ore availability is limited in the market. Apart from few smaller merchant miners who have already exhausted their EC limit a few more merchant miners have kept their offers on hold due to pending dispatches of previous bookings and stacking concerns, sources reported to SteelMint.

Govt-owned steelmaker-Steel Authority of India Ltd (SAIL) conducted an auction today from its Bolani mines in Odisha. The entire offered quantity of 64,000 t iron ore fines (Fe 62.5%) received bids at INR 4,260-4,280/t (loaded, excluding Royalty). Bids have increased by around INR 500/t above against the last auction held on 12th Feb'21 for a similar grade, SteelMint learned from sources.

Rationale:

Single deal from today's SAIL auction was considered for T1 trade and hence kept the weightage in this index at 50%. No other confirmed fines trade was reported in this publishing window

SteelMint has also received eleven (11) offers, indicative prices under T2 trade in this publishing window out of those nine (10) were taken into consideration and given 50% weightage. To see SteelMint's iron ore assessments, pricing methodology and specification documents, Click here.

Odisha's Essel Mining raises iron ore lump offer by INR 500/t - Odisha's Essel Mining has increased iron ore lump offers by INR 500/t this week, credible sources reported to SteelMint. Offer for lump (5-18 mm, Fe 62%) stands at INR 8,100/t (ex-mines, including Royalty, DMF & NMET). However, the miner has kept the fines offer unchanged.

Odisha iron ore prices:

DR-CLO lots in NMDC's Chhattisgarh auction fetch aggressive participation - India's largest iron ore miner - NMDC conducted iron ore e-auctions yesterday (on 19th Mar'21) for 701,400t iron ore from its Chhattisgarh mines. Offered quantity consisted of 600,600 t of fines, 50,400 t DR-CLO and rest comprised of lump and ROM. The DR-CLO lots received a good response with the entire quantity booked and bids increased by around INR 1,100/t over the set base price of INR 5,965/t, as it is still cost-effective than other substitutes. Bids for lump moved up by around INR 300 over the set base price of INR 5,139/t, SteelMint learned. However, the fines lot fetched a weak response as only 58,000t was booked.

Bids remain stable in recent Karnataka e-auction by private miners - In a recent Karnataka e-auction held on 16th Mar'21, out of the total quantity of 749,955 put up for auction, 371,000 t was booked. JSW Steel stood the largest buyer at 276,000 t. Iron ore fines (Fe 57.5%) offered by Vedanta received bids at INR 2,476/t against INR 2,476-2,486/t in the last auction conducted on 9th Mar' 21. In another auction conducted for 511,500 t on 16th Mar'21, 226,000 t iron ore was booked with JSW Steel Ltd being the largest buyer at 68,000 t.

Goa govt to put 1.63 mn t iron ore for auction on 24 Mar'21 - Directorate of Mines & Geology (DMG) of Goa plans to conduct 25th e-auction for 1.62 mn t iron ore on 24 Mar'21. The material to be put on auction consists of fines, lumps and ROM with highest grade reaching Fe 57.74%. The auction is being held after a gap of almost four months. In Nov'20 auction, about 3.3 mn t of iron ore was put under hammer out of which only 1.1 mn t was sold.