Morgan Stanley has highlighted an unexpected move by NMDC to cut iron ore prices by ₹550 per tonne for lumps to ₹5,550 per tonne and by ₹500 per tonne for fines to ₹4,750 per tonne. The brokerage said the price reduction came as a surprise to the market, as most analysts had anticipated either stability or a slight price increase.
The firm noted that the domestic discount of iron ore fines to import parity prices has widened to 57% from 53%, underscoring softening domestic realisations. Morgan Stanley said prices were expected to rise modestly due to stronger post-monsoon steel demand, the potential extension of safeguard duties supporting domestic prices, and rangebound seaborne iron ore rates.
The unexpected price cut may weigh on near-term sentiment in the steel and mining sector. The brokerage added that NMDC’s move could reflect a cautious approach to sustaining volume growth amid rising competition and slower demand pickup in certain regions.
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