KIOCL, a state owned Iron Pellet producer based in Mangalore (Karnataka), has an installed capacity of 3.5 MnT pa maintains domestic prices at January levels.
The company is offering Pellets at INR 8,400/MT (basic) and has quoted a discount of INR 200/MT for 100,000 MT Pellet purchase at same levels as in January.
In the month of January, KIOCL sold 30,000 MT Pellets to Sponge iron buyers located in Gujarat. The company has plans to produce and sell 250,000 MT of the material this month.
“There is no relief to Pellet manufacturers as Iron ore prices continue to stand on higher side and the cost of Pellets production is also high. At present, Sponge iron offers have been stable from past one month. Looking at increasing availability of Pellets in Indian domestic market, it is not feasible to raise offers as it would be not accepted by the buyers”, said sources.
For FY 14, a 1.8 MnT of pellet production and sales target has been set for KIOCL, while signing MoU with Ministry of Steel and price is assumed on an average of INR 7500/MT.
Last fiscal, the company produced 1.3 MnT Pellets by utilizing 36% of total installed capacity and sold 1.2 MnT.
KIOCL procures Iron ore from NMDC’s Bailadila mines in Chhattisgarh. For the first time in FY 14, the company purchased fines from Karnataka e-auction (NMDC’s Donimalai mines). 20,000 MT of Fe 60.5 fines was bought at INR 2,155/MT (basic) in Qtr 3.
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