Imported Iron Ore Lumps Turn Costlier with Global Price Hike; Buyers Inactive

According to market sources report to SteelMint, inquiries for imported South African lumps to India has dropped amid soaring prices caused due to global price hike. Although no firm offers/bids were heard but assessment for South African lump to India is learned to be around USD 134-135/MT, CNF Kandla, up as against USD 125/MT, CFR Kandla in last month.

The spot iron ore fines (Fe 62%) index price increased to USD 118/MT, CFR China last week, the levels were last witnessed in Apr'14. The prices increased amid Rio Tinto’s announcement of drop in its iron ore Pilbara shipments for the year. Rio Tinto 2019 Pilbara iron ore shipment guidance is reduced to 320-330 MnT as against 333-343 MnT previously.

The rising lump prices have made its procurement unviable at the moment and increased dependency of steel mills on pellets. Also, the current prices are expected to keep lump market on lower side for a couple of months, mentioned west coast based Indian steel mills.

Spot lump premium witnessed rise at USD 0.3601/DMTU last week as against USD 0.3300/DMTU, CFR China, a week ago owing to supply concerns. However, towards weekend the prices dropped to 0.3400/DMTU amid sharp rise in global iron ore fines prices.

Gujarat based mills prefer domestic pellets

West India based pellet maker - Jindal SAW increased offers to INR 9,100/MT, delivered Kandla towards end of last week amid rising demand. Company’s last offer for Fe 64% grade pellets was at INR 8,900/MT a week before.

South Africa iron ore exports up in Apr’19

South African iron ore exports increased 17% in Apr'19 to 6.09 MnT, as against 5.21 MnT in Mar'19. On yearly basis, exports increased 6% as against 5.75 MnT in Apr'18. South Africa's Transnet (Transport Company) is installing iron ore tippler at Saldanha port terminal to sustain current output of 60 MnT p.a. The purpose of installation is to replace the older two tipplers. The operation is expected to start by July'20.