SteelMint: Odisha iron ore fines index falls in dull market

SteelMint's weekly Odisha iron ore fines (Fe 62%) index stood at INR 5,600/t ex-mines, inching down by INR 100/t on 29 April 2023 compared to the last assessment on 22 April, as deals are not happening regularly via miners. However, active deals in low grade fines of Fe57-59% were reported.

India's largest merchant iron ore mining company, NMDC, decreased list prices of iron ore today by INR 300/t in DR-CLO and fines by INR 100/t, effective from 29 April.

As per participants, iron ore prices may fall in the upcoming days as trade and sentiments are very weak. Recently, pellet makers, too, cut their offers on falling sponge and semi-finished steel prices.

Rationale:

• T1- No deal was recorded but and thus not considered for price calculation this week and thus given 0% weightage for index calculation.
  
  
• T2- SteelMint received twelve (11) offers and indicative prices under T2 trade deals in this publishing window. All were taken into consideration and given 100% weightage. To check SteelMint's iron ore assessment, pricing methodology, and specification documents Click here.
  
  

Why did iron ore index fall?

• PELLEX inches down amid active trade: SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, inched down by INR 50/t to INR 9,300/tonne (t) DAP Raipur. Overall, deals of around 21,000 t were recorded at INR 9,250/t DAP Raipur so far this week. However, as per sources, buyers were expecting a reduction in iron ore prices from Odisha in the upcoming days owing to a fall in pellet offers and weak response to the OMC auction. Iron ore pellet (Fe 63%) prices in Barbil stood at INR 8,650/t loaded, down by INR 400/t w-o-w.
  
  
• Durgapur pellet prices fall: Durgapur pellet (Fe63%) prices decreased by INR 500/t to INR 9,200/t exw on w-o-w. Pellet prices dropped as sponge P-DRI prices moved down by INR 1,150/t to INR 29,850/t DAP Durgapur.
  
  
• Sponge iron prices down w-o-w: SteelMint's index for C-DRI (exw Rourkela) was calculated at INR 30,950/t, inching down by INR 500/t as against INR 31,450/t a week ago.
  
  
• Global iron ore prices sharply fall w-o-w: Benchmark iron ore Fe 62% fines prices fell by $5.65/t w-o-w to $106.5/t CFR China on 28 April, hitting a four-month low, amid weak domestic steel demand in China, which also impacted iron ore market confidence. Prior to a five-day national holiday, Chinese steel mills have practically finished restocking their inventory. Expectations for May remain largely negative, owing to China's tighter production restrictions aimed at reducing the steel surplus.
  
  

India iron ore prices:

Outlook: In the upcoming days, Odisha's iron ore prices may fall as miners are under pressure to sell. Market players will get better clarity on prices next week.