Iron ore insight february

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10 February, 2014

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Iron Ore INSIGHT

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Indian Iron Pellet export market opened up

when domestic prices touched an all time

low at INR 6,100/MT (Ex-work Barbil) on 22

July, 2013. Exporters received a better

realization from overseas trades as Rupee

depreciated against USD and Chinese Iron

ore prices were high.

Jindal Steel was the biggest exporter and

exported 0.47 MnT followed by Essar &

Ardent

India Exported 1.1 MnT Iron Pellet in Apr-Dec 2013

Iron Pellet Export from various Indian Ports in Apr-Dec, 2013

Month Port Shipper Qty Total Qty (Month Wise) Des�na�on

Apr - - - - -

May - - - - -

Jun Vizag Essar 39,100 39,100 Vietnam

Jul Vizag Essar 65,100 65,100 China

Aug Paradip Jindal 48,000 - Oman

Aug Paradip Jindal 53,000 101,000 China

Sep Paradip Jindal 50,000 - China

Sep Paradip Jindal 51,803 101,803 China

Oct Gangavaram Jindal 54,000 - China

Oct Gangavaram Jindal 49,000 - China

Oct Haldia Ne�ncon 22,500 - China

Oct Paradip Ardent 43,200 - China

Oct Paradip BRPL 50,000 218,700 China

Nov Paradip Jindal 7,500 - Oman

Nov Paradip Essar 53,900 - China

Nov Paradip Arya 35,000 - China

Nov Paradip BRPL 48,000 - China

Nov Paradip Ardent 43,650 - China

Nov Gangavaram Jindal 53,000 - China

Nov Haldia Ne�ncon 22,500 - China

Nov Vizag Essar 42,240 305,790 China

Dec Gangavaram Jindal 53,000 - China

Dec Paradip Essar 54,000 - China

Dec Haldia Ne�ncon 28,000 - China

Dec Paradip Essar 53,600 - China

Dec Gangavaram Jindal 51,000 - China

Dec Paradip Ardent 35,000 274,600 China

Grand Total 1,106,093 1,106,093

Qty in MTProvisional Data

Company Exported Qty

Jindal Steel 470,303

Essar Steel 307,940

Ardent 121,850

BRPL 98,000

Ne�ncon 73,000

Arya 35,000

Total 1,106,093

Qty in MTProvisional Data

Companies's Iron Pellet Export in Apr-Dec, 2013 Paradip Port in East Coast exported

maximum quantity of 0.6 MnT

China was the largest consumer of

Indian Pellets

5% export duty on Pellets imposed by

Indian Government on 27 Jan, 2014 has

lowered realizations by INR 500/MT

Source: SteelMint

Source: SteelMint

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Par�culars Grade/Fe Size Prices (INR/MT) M-o-M change

Iron Ore Lumps

Odisha: Rungta mines (loaded to wagon, including Royalty) 63 5-18 mm 6,800 0

NMDC (Basic Prices, Royalty & Taxes Extra) 65 6-40 mm 4,500 0

Iron Ore Fines

Domes�c (Ex mines Odisha, including Royalty) 63 2,350 0

Export (CNF China in USD/MT) 63.5/63 122 13

Iron Pellet

Odisha (Loaded to wagons, Basic Prices) 63 7,000 600

63 7,900 0

60 7,200 0

Pig Iron

Cu�ack (Basic Prices) Steel 24,000 500

Sponge Iron

Raipur (Basic Prices) 80 FeM 21,600 1,550

Bellary (Basic Prices)

Prices as on 08 Feb, 2014

Miners in Odisha kept Iron ore prices unchanged for Feburary 2014 as state government’s

restriction of only 50% Iron ore sales is allowed to outside states has offset chances of

price hike.

NMDC hikes Iron ore fines prices by INR 100/MT over good demand. Offers for lumps

remain unchanged. Production and sales improved in January, at 3 MnT and 2.9 MnT

respectively.

Miners/E-auc�on State Grade/Fe 5-18 mm Grade/Fe 10-30 mm Grade/Fe Fines

Rungta Odisha 63 6,800 63 6,270 63 2,650

Essel Odisha 63 6,775 63 6,025 63 2,675

Serajuddin Odisha 63 5,620 63 2,620

Indrani Patnaik Odisha 63 5,200 61 4,500 63 2,200

KJS Ahluwalia* Odisha 63 5,450 61 4,300 63 2,350

KN Ram Odisha 62 5,600 62 2,450

Singhbhum Minerals Jharkhand 60-62 4,900 60-62 4500

Grade/Fe 6-40 mm Grade/Fe 10-150 mm Grade/Fe Fines

65 4,500 64 3,950 64 2,910

Grade/Fe 10-40 mm

67 5,190

Grade/Fe ROM Grade/Fe Lumps Grade/Fe Fines

E-auc�on (Jan) Karnataka 67 3,545 63 3,849 60 2,661

E-auc�on (Jan) Karnataka 63 3,005 62.5 3,965 58 1,833

All Prices loaded to wagons; including Royalty | *Prices are Ex-mines: including Royalty | Prices are Ex-Jharkhand; including Royalty

Royalty 10%, FDT 12% & VAT 5.5% Extra

Basic Prices including royalty 10%

Source: SteelMint

Source: SteelMint

Indian Iron Ore Prices (INR/MT) in Feb'14

NMDCCha�sgarh

Odisha

Chhattisgarh

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4.7 MnT Iron Ore sold in Jan 2014 in e-auctions

Iron ore sales increased from 2.1 MnT in Dec’13 to 4.7 MnT in Jan’14

JSW was the biggest buyer and purchased 2.5 MnT Iron ore

NMDC sold 1 MnT Iron ore and other mines sold 3.7 MnT

In January 2014, average fines prices stood at INR 2,661/MT and lumps at

INR 2,635/MT (basic, Fe 60)

Sesa Sterlite set higher base price at INR 4,000/MT (basic) for Fe 58 fines

on 31 Jan, 2014

Karnataka

Goa

India Exported

1 MnT Iron

Ore in Jan’14

Iron Ore

E-auction on

17 Feb, 2014

Source: SteelMint

Mines Bid Qty Alloted Qty

NMDC 1,100,000 984,000

Other Mines & Stockyards 3,901,000 3,705,000

Total 5,001,000 4,689,000

Qty in MT

Karnataka Iron Ore E-auction in Jan'14

Source: SteelMint

Material type Bid Qty Alloted Qty

Fines 556,000 460,000

Lumps 544,000 524,000 Qty in MT

NMDC's Donimalai & Kumarswamy Mines

In Nov, 2013, Supreme Court allowed e-auction of 15 MnT Iron ore lying at jetty and stock point. Goa

government invited application from prospective bidders on 14 Jan, 2014; only qualifying bidders can

participate.

About 5,70,000 MT (Fe 47-56/50) Iron ore (fines & lumps) would be auctioned in the first phase,

which belongs mainly to Sesa Mining and Sesa Sterlite, VM Salhgaocar, Timblo Enterprises, SFI,

Chowgule and MSPL. Iron ore could be utilized for sale, domestic consumption or can be exported.

Transportation of ore would begin within 30 days of auction.

JharkhandSingbhum Minerals Company, operated by Thriveni Earth Movers restarted Iron ore mining

operations in February, 2014. The mines have an Environment Clearance (EC) of 0.4 MnT pa.

Iron ore export drops from 1.3 MnT in Dec’13 to 1 MnT ( 27%) in Jan’14

Demand from China weakened because of New Year Holidays from 31 Jan, 2013 to 05 Feb, 2014

Rungta Mines was the largest exporter and exported 163,000 MT Iron ore

Paradip port exported 0.5 MnT; by 10.8% M-o-M

Shipper Paradip Haldia Vizag Dhamra Gangavaram Redi Grand Total

Rungta Mines 56,000 20,000 33,000 - 54,000 - 163,000

Bagadiya Brothers 72,600 - - 72,582 - - 145,182

Kashvi Power 111,439 - - - - - 111,439

SM Niryat 109,185 - - - - - 109,185

Kalinga Allieds 80,700 - - - - - 80,700

MMTC - - 78,210 - - - 78,210

Royal Lines - - 58,400 - - - 58,400

Samruddha - - - - - 56,500 56,500

LG Minerals 51,492 - - - - - 51,492

Essel Mining - 16,200 22,300 - - - 38,500

Chamong Tea - 20,710 - - - - 20,710

Lords Blue - 20,000 - - - - 20,000

Maa Samelaswari 20,000 - - - - - 20,000

Sparsh Baldev - - 19,000 - - - 19,000

Grand Total 501,416 76,910 210,910 72,582 54,000 108,100 1,023,918

Provisional Data

Qty in MT

Iron Ore Export from various Indian Ports in Jan 2014

Source: SteelMint

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Route Vessel TypeFreight

(USD/MT)3 Months

(Nov)6 Months

(Aug)

India East Coast - China Supramax 15.0 14.5 10.8

Brazil- China Capesize 19.8 22.1 20.3

South Africa -China Panamax 21.1 20.1 18.5

Vessel Freight as on 08 Feb, 2014 with Previous Comparisons (Week 1)

137

134 133

136 136

129

124

129

134

139

Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14

Pri

ces

in U

SD/M

T

Monthly Average Prices of 63.5/63 Iron ore Fines, CNF China

Source: SteelMint

Prices fall

sharply owing

to less

demand/stock

ing before

Lunar New

Year Holidays

Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14

Source: SteelMint

19,000

20,60020,400

20,150 20,20020,300

18,000

19,000

20,000

21,000

Bas

ic P

rice

s in

IN

R/M

T

Monthly Average Prices of Sponge Iron in Raipur

Pellet prices drop to INR 7,000-7100/MT (ex works Barbil) because of weak domestic demand

and falling margins from exports

KIOCL retains domestic Pellet prices at INR 8,400/MT (basic) for Feburary 2014 owing to high

Iron ore prices; Jindal Saw (Rajasthan) maintains offers at INR 8,800-8,900/MT (delivered)

On 29 Jan, 2014, Essar Steel shipped 40,000 MT Pellets to Kamachi Steel (Chennai) at INR

7,500/MT FOB Vizag Port

On 20 Jan, 2014, Essar Steel closed 21,340 MT Fe 64 & DR grade Pellet export deal at USD

168/MT FoB with UK based trader; material was shipped from Paradip Port to Saudi Arabia

Trade Wise

Seema GoenkaAnalyst

Email: [email protected]

Mob: +91 9575100530

Iron OreSteelMint

INSIGHT

CONTACT DETAILS

Alok Singh ThakurAssociate-Research

Raipur:

#301, Jeevan Parisar,

Rajeev Nagar

Behind Crystal Arcade

Raipur (C.G) - 492 007 India

Tel: +91 771 2284888

Kolkata:

5th Floor, Vishvakarma Building,

86, Topsia Road,

South-West Block

Kolkata (W.B) - 700 046, India

Tel: +91 33 22852063

REPORT BY

Email: [email protected] | Web: www.steelmint.com

Source: SteelMint

Market was vola�le owing

to subdued demand of Finished steel

products

10 February, 2014