Indian Oil Corporation Ltd. (IOC), the country’s second-largest producer of petroleum coke, conducted another online auction of pet coke from its Paradip refinery in Odisha on Friday, 23 Aug’19, wherein the offered quantity was 40,000 MT.
The reserve price was declared during the live auction as INR 4,490/MT.
The entire quantity of 40,000 MT was sold at an average price of INR 4,510/MT, which’s marginally higher by INR 20/MT over the reserve price.
Notably, IndianOil had conducted its first pet coke auction for this month from Paradip refinery on 13 Aug’19 for 60,000MT. However, no bid was received in this auction — although the reserve price of INR 5,160/MT had remained unchanged over the previous two auctions held in the month of July.
Sources suggested that the market participants were expecting a reduction of around INR 400-500/MT in the reserve price and hence did not bid.
In the first auction of July, conducted on the 11th, the entire offered quantity of 50,000 MT was sold at a higher bid price of INR 5,700/MT, against a reserve price of INR 5,160/MT.
In the second auction of July, conducted on the 24th, the entire quantity of 30,000 MT was sold at a bid price of INR 5,160/MT, which was same as the reserve price.
In the current auction, the reserve price was reduced by INR 670/MT over last auction. Moreover, the offered quantity was also reduced from 60,000 MT to 40,000 MT. Furthermore, the bid price received was lower by INR 650/MT over the second auction of July.
In the current auction, major cement manufacturing companies from Chhattisgarh are allotted 30,000 MT, while the remaining 10,000 MT is allotted to a cement manufacturer in Odisha.
As the quantity on offer was reduced in this auction, IndianOil may possibly consider increasing sales through its newly-incorporated rake facility as well as through road transport, apart from the auctioning system.
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