SteelMint: Odisha iron ore fines index rises INR 300/t on positive market sentiments

SteelMint's weekly Odisha iron ore fines index (Fe 62%) has inched up INR 300/t w-o-w, to INR 4,900/t ex-mines. On account of the hike in pellet and sponge iron prices this week, iron ore prices have gained on the back of limited material availability from small merchant miners who have largely exhausted their EC limits.

However, not many buyers were active in the market as they had secured volumes at OMC's auction last week.

Rationale:

• T1- As per SteelMint sources, one miner from Odisha sold around 16,000 t of Fe 62% fines at INR 4,900/t (ex-mines, including royalty, DMF and NMET) this week. The trade was considered for Fe 62% fines under calculation of the index and given 50% weightage.
  
  
• T2- SteelMint received Twelve (12) offers and indicative prices under T2 trades in this publishing window. Nine (09) were taken into consideration and given 50% weightage. To check SteelMint's iron ore assessment, pricing methodology, and specification documents Click here
  
  

Odisha iron ore prices

Key market highlights:

• Bids for iron ore lump rise sharply at NMDC's Chhattisgarh auction: India's top iron ore miner NMDC conducted an auction on 19 Jan for nearly 320,000 t of iron ore from the Kirandul and Bacheli mines in Chhattisgarh. The auction received good response for lump ore, with the entire quantity of DR-CLO getting booked. Bids for DR-CLO increased by around INR 1,580-1,670/t, while those for Baila lump, fines and run of mine (ROM) ore remained at the base price level.
  Market sources expect NMDC to revise its monthly iron ore prices shortly.
  
  
• Madhya Pradesh govt notifies mineral blocks for auctions: The Madhya Pradesh government has begun the auction of mining leases for 12 blocks including one iron ore and two bauxite deposits. These apart, it will also auction rights for exploration and mining to nine composite leases, including seven manganese blocks, one bauxite block and one bauxite-limestone block.
  
  
• NMDC's auction from Kumaraswamy garners good response: NMDC conducted an iron ore e-auction on 19 Jan from its Kumarswamy mines at which 533,000 t was booked out of a total quantity of 543,000 t. JSW Steel emerged as the largest buyer, with bookings at 299,000 t, followed by Vanya Steels Private Ltd. and Janki Corp. Ltd. at 32,000 t each. Iron are lump (Fe 61.88%) was booked at INR 3,416-3,426/t (basic, taxes extra), up INR 70/t as against the previous auction on 4 Jan.
  
  
• 27th iron ore e-auction held in Goa: The Directorate of Mines and Geology (DMG), Government of Goa, has notified the base price of the iron ore lots for the 27th e-auction held on 19 Jan. The total quantity put to auction was 2.22 mn t, with the base price in the range of INR 300-450/t. However, the auction results could not be collected till the time of publishing this index.