Monday, March 28,
State-run NMDC is likely to delay revision in iron ore prices for the April-June quarter by 15 days to mid-April as long-term contracts with Japan steel mills have not been renewed yet..*, a top company official said.
“This time there could be little delay as contracts with Japanese firms are yet to be renewed. Domestic prices are benchmarked to that prices. So, we will take a view on that after some time, likely by middle of April,” NMDC Chairman Rana Som told PTI.
Earlier, the company used to revise the iron ore prices at the beginning of a particular quarter. It had raised the prices by about 5.22 per cent in January for the last quarter of this fiscal.
However, the NMDC Chairman was hopeful that the issue will soon get government clearance and contracts with the Japanese firms will be signed at the earliest.
“It is at the higher levels and I hope it to be approved soon. I am sure that the contract will be renewed as early as possible,” Som said, adding that the company can not move ahead without government approval.
NMDC exports about 3-4 million tonnes per annum (MTPA) of iron ore to Japanese mills under the long term agreement (LTA) with Japanese steel mills, canalised through MMTC and the agreement, to be done for next five years, is due for renewal from April 1.
The matter has been pending with the government for approval since the beginning of this year as strong differences had emerged earlier between NMDC and trading major MMTC over the long-term supply pact.
The largest domestic iron ore miner was then opposed to the idea fearing lower realisations, while the trading major MMTC was pitching for it, citing long-standing relation between India and Japan.
The NMDC Chairman, however, indicated that the iron ore prices would again be raised as the international prices are yet to come down to a big extent.
“Definitely, international prices are not as high as USD 180 per tonne but even at USD 164-165 per tonne, it is on the higher side. So, I think that domestic prices will certainly have some impact of that,” he said, although refused to comment on the extent of price hike.
“We will take a view on that after some time, when we meet likely by middle of April,” he said.
Som added that despite the severe destruction due to earthquake and tsunami, the Japanese firms have not asked to halt or reduce the supplies.
Source: PTI
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