India: BigMint's iron ore fines export index unchanged w-o-w

• Discount widens for iron ore fines
  
  
• Sellers are yet to wait for decent bids
  
  
• Australian miner increases discount sharply
  
  

BigMint's weekly Indian low-grade iron ore fines (Fe 57%) export index remained largely stable w-o-w at $58.5/t FOB east coast on 28 March 2024. No deals were heard for standard Fe 57% fines in this publishing window amid bearish market sentiments for Indian material in the sea market. However, a deal has been concluded for low-grade fines (Fe 54.3%) at around 30% discount on index price, however, it has not been confirmed by the buyer or seller at the time of publishing this article.

A prominent Australian miner has significantly increased the lower grade fines discount for the April 2024 deliveries. The miner announced around 18% discount for April trades against 7% in March as per the sources hence no official confirmation received.

A miner from eastern India said: "The current market is not feasible for us to sell material in the overseas market as there was around $13-14/t bid-offer disparity seen amid cautious bidding from overseas buyers. The discount has widened for Indian material as the buyer asking for over 20% discount for April delivery to conclude the deals. The transaction volume for export from India significantly decreased amid the unacceptable prices for sellers to sell the material. We are holding the material at ports and waiting for some decent prices to export the iron ore fines in the coming days."

The benchmark Fe 62% fines index fell by $6/t w-o-w to $101/t CFR China on 20 March. Iron ore prices dropped amid weak buying interest from local steelmakers for raw materials following stockpiling for finished steel inventory. As per the report, traders were shipping out their cargoes and selling off inventory, anticipating a further drop in iron ore prices.

An exporter said, "Recent hike in Australian miner discount led the Indian overseas offers will get affected, and deals may conclude even above the 25% discount. Observing the Indian domestic fines prices, it is very hard for traders to sell materials at the current prices."

The exporters are currently confused, as some are expecting that the market will improve in the coming days and holding their material to sell. Some other exporters want to export their material even at low prices amid the fear of more price drops in the coming days in the overseas market.

On the other hand, a few Chinese steel sources reported that portside offers in China for Indian iron ore fines (Fe57%) fell by RMB 30/t ($4/t) w-o-w on 28 March. The offers were recorded at around RMB 590/t ($84/t) at Qingdao Port inclusive of all import taxes and port charges.

A market analyst from Singapore said that the Chinese market is very weak in the last few days amid sluggish downstream steel demand in the domestic market. The Chinese market is facing a liquidity problem, and the buyers only procure the need based raw materials. In the last one week finished steel prices dropped by RMB 110/t ($15/t) amid lack of demand.

Notably, iron ore inventories at China's major ports increased by 1.6 mnt to 142.1 mnt on 28 March compared to the last week, according to SteelHome data.

Other highlights:

• DCE iron ore futures September contract releases: The iron ore futures on the Dalian Commodity Exchange (DCE) for the September 2024 contract announced today. The futures were recorded at RMB 758/t ($105/t) today.
  
  
• India iron ore shipment falls w-o-w: India's iron ore export shipments were recorded at 417,480 t in the third week of March, compared to 744,679 t in the second week of March, as per vessel line-up data maintained with BigMint.
  
  

Price indicators:

• No deal was reported this week for fines Fe 57% from the East Coast and not taken into consideration for calculation. Thus, given 0% weightage. For detailed methodology Click here.
  
  
• BigMint received twenty-one (21) indicative prices in the current publishing window and fourteen (14) were considered for price calculation as T2 inputs and given a 100% weightage.
  
  

Outlook:

The seaborne export market for Indian iron ore fines may remain volatile amid sluggish demand and uncertainty in the Chinese market.