SteelMint's Odisha iron ore fines index inches down, market awaits OMC auction results

SteelMint's weekly Odisha iron ore fines (Fe 62%) index decreased by INR 100/t to INR 4,700/t ex-mines on 15 July, 2023 compared to the last assessment on 8 July. The absence of active trades and fall in sponge prices have kept fines prices under pressure this week.

Rationale:

• T1- No deal was recorded and thus not considered for price calculation this week; given 0% weightage for index calculation.
  
  
• T2- SteelMint received Nine (9) offers and indicative prices under T2 trade deals in this publishing window. Six (6) were taken into consideration and given 100% weightage. To check SteelMint's iron ore assessment, pricing methodology, and specification documents Click here.
  
  

Factors which impacted Odisha iron ore index:

• Pellet prices stable in Barbil: Raw pellet (Fe63%, 6-20 mm) prices in Odisha's Barbil remained stable compared to last week. The current assessment stands at INR 7,650/t loaded to wagons on 14 July.
  
  
• Sponge prices fall in Rourkela: SteelMint's assessment for sponge iron C-DRI (FeM 80%) prices in Rourkela decreased by INR 750/t to INR 26,950/t exw on 15 July compared to last week. Billet prices decreased by INR 1,000/t w-o-w to INR 40,450 exw Rourkela on 15 July.
  
  
• Pellet export trades pick up: An Odisha-based pellet maker has concluded an export deal for 55,000 t of material (Fe63%) this week, sources informed. The deal was heard to have concluded at around $117-118/t CFR China for July shipment. SteelMint's India pellet (Fe 63%, 3% Al) export index FOB east coast inched down by $1/t w-o-w to $107/t on 12 July. A South India-based pellet maker had floated an export tender for 100,000 t of material (Fe 63%; Al2O3+SiO2 8%) on 14-15 July. The tender was heard to have been concluded at around $116/t FOB.
  
  
• China spot iron ore prices rise w-o-w: Chinese spot iron ore fines Fe 62% prices increased by $6.35/t w-o-w to $115.8/t CNF China on 14 July. Prices rose after the People's Bank of China (PBOC) expressed optimism about the nation's economy and property markets. The deputy governor of PBOC said in a press conference that it does not see deflationary risks in the second half of the year.
  
  

Outlook

Due to monsoon, iron ore production and logistic issues continue to impact purchase decisions. On the other hand, market participants are waiting for OMC's auction which is scheduled next week. However, drop in sponge iron prices have weighed down bids.