SteelMint's Odisha iron ore fines index falls amid lack of deals

SteelMint's weekly Odisha iron ore fines (Fe 62%) index decreased by INR 250/t to INR 4,950/t ex-mines on 1 July, 2023 compared to the last assessment on 24 June.

High-grade iron ore (Fe 62%) deals have remained limited, however, low-grade deals are happening in the market, reported sources. As per the sources, buyers are currently booking low-grade iron ore (fines Fe 57-59%) from Odisha but due to cost issues, they are booking high-grade material from Chandrapur, Maharashtra and blending it.

Rationale:

• T1- No deal was recorded and thus not considered for price calculation this week; given 0% weightage for index calculation.
  
  
• T2- SteelMint received twelve (12) offers and indicative prices under T2 trade deals in this publishing window. Eight (8) were taken into consideration and given 100% weightage. To check SteelMint's iron ore assessment, pricing methodology, and specification documents Click here.
  
  

Market overview-

• Pellet prices fall in Barbil: Raw pellet (Fe63%, 6-20 mm) prices in Odisha's Barbil decreased by INR 550/t w-o-w to INR 7,650/t loaded to wagons on 30 June as compared to last week.
  
  
• Sponge prices fall in Rourkela: SteelMint's assessment for sponge iron C-DRI (FeM 80%) prices in Rourkela decreased by INR 350/t to INR 28,250/t exw on 1 July compared to last week. Price was recorded in June month at INR 28,000/t exw, which is decreased by INR 1,100/t as compared to 30,000/t exw in May 2023.
  
  
• Pellet export stable, realisations still low: India's pellet export index remained range-bound w-o-w. SteelMint's India pellet (Fe 63%, 3% Al) export index FOB east coast remained stable w-o-w at $109/t on 28 June. Domestic pellet (Fe 63%) prices stood at INR 7,650/t loaded on to wagon for Barbil, eastern India. On the other hand, SteelMint's pellet export ex-plant price realisation for the Barbil region stood at around INR 7,100/t this week.
  
  
• China spot iron ore prices largely stable w-o-w: Chinese spot iron ore fines Fe 62% prices stood at $111.6/t CNF China on 30 June, 2023, which inched down by $0.55/t w-o-w, against $112.15/t CNF China in the previous week as Chinese market participants returned from their holidays. Following the holidays, the market had some areas of buying activity, but import margins have been shifting positively recently.
  
  

Outlook

Buyers are expected price cut in Odisha iron ore prices in the upcoming weeks amid fall in demand during monsoon season. However, seasonal tightness may support prices.