SteelMint: Odisha iron ore fines index falls INR 150/t on weak buying interest

SteelMint's weekly Odisha iron ore fines (Fe 62%) index has moved down by around INR 150/t to INR 6,750/t (ex-mines, including royalty, DMF and NMET).

OMC had scheduled auctions for iron ore lumps and fines on 31 Aug'21. The auctions received dull participation with lots fetching bids close to the base price. The fines auction fetched bids for 20,000 t out of 902,000 t.

JSW Steel has cut iron ore offers by around INR 2,000-2,500/t, m-o-m, as per reports. The reduction in iron ore offers by Odisha merchant miners and decline in domestic pellet prices are keeping prices under pressure.

Recent trade and rationale:

• A deal from OMC (Koira) was considered this week for iron ore fines; therefore this T1 trade was accorded 50% weightage in the index calculation for Fe 62% fines.
  
  
• Steel Authority of India Ltd (SAIL) conducted an auction on 31st August for 136,000 t of iron ore fines (Fe 62.5%, indicative) from the Bolani iron ore mines in Odisha. Out of the total quantity on offer, the company received bids for only 16,000 t at INR 7,530/t (loaded on to wagon, including royalty, DMF, NMET and the additional amount mentioned in the MMDR Amendment Act, 2021), SteelMint gathered from sources.
  
  
• SteelMint received thirteen (13) offers, indicative prices under T2 trade in this publishing window and ten (10) were taken into consideration and given 50% weightage. To check out SteelMint's iron ore assessments, pricing methodology and specification documents Click here
  
  

Similarly, SteelMint's iron ore lump (5-18mm, Fe 63%) index fell to INR 11,000/t (ex-mines, inclusive of royalty, DMF and NMET) - lower by INR 450/t on a weekly basis. OMC's lump e-auction had fetched bids for only 238,000 t of material out of a total quantity of 765,000 t.

NMDC slashes prices by over INR 1,000/t ($14/t) from Chhattisgarh mines

India's largest government-owned merchant iron ore miner, NMDC, has cut iron ore prices for Sept'21 deliveries by INR 1,000-1,160/t ($14-16/t), SteelMint learnt from sources.

FOR prices excluding Royalty, DMF and NMET

SAIL iron ore auction receives active response

Steel Authority of India Ltd (SAIL) conducted an auction on 3 Sept'21 for 36,000 t of iron ore concentrates (Fe 64.7%-Fe 65.02%) from its Dalli and Rajhara iron ore mines in Chhattisgarh. The auction received active participation with the entire quantity getting booked at INR 3,020-3,080/t (loaded on to rake, including royalty, DMF, NMET and the additional amount as per MMDR Amendment Act), SteelMint notes.

About 52% of material booked at Goa iron ore e-auction

Goa's Directorate of Mines and Geology had conducted the 26th iron ore e-auction on 31 Aug. About half the material, or 0.81 mn t, was booked out of the total of 1.57 mn t on offer. The base price was from INR 350/t to INR 500/t. The material consisted of low-grade fines, lumps and ROM, with Fe 58.01% being the highest grade on offer.

Madhya Pradesh: Domestic prices of iron ore concentrates stable

Prices of iron ore concentrates (Fe 63%) in the Jabalpur region have remained stable at around INR 8,000-8,100/ t exw.

Madhya Pradesh, the fifth-largest iron ore producing state in India, produces around 2.5-3 mn t of iron ore annually. About 96-98% of total production is below Fe 55% grade, which is beneficiated and used by pellet producers as well as for sintering.

30% of material booked at NMDC's Kumaraswamy iron ore e-auction

NMDC had conducted an iron ore e-auction from its Kumaraswamy mines on 3 Sept'21 at which 115,000 t was booked out of 380,000 t put to auction. Highlights:

• JSW Steel Ltd. emerged as the largest buyer with 88,000 t followed by Minera Steel and Power Private Ltd. and BMM Ispat Ltd with 8,000 t each.
  
  
• The iron ore fines (Fe 62%) lot was booked at INR 4,804/t and lump ore (Fe 60.6%) at INR 5,532 (basic, taxes extra).