Tight material availability and fixed offers by Odisha’s leading iron ore miners have pushed a few eastern India-based mills to shift their sourcing pattern.
SteelMint’s weekly index for Odisha iron ore fines (Fe 62%) is assessed at INR 9,600/t (ex-mines, including royalty, DMF and NMET). The index increased by around INR 200/t against the last assessment. Onset of monsoon and evacuation issues have continued to keep material availability tight, sources highlighted.
However, hardly any trade was reported from the Odisha miners. As per sources, eastern India-based buyers have started sourcing iron ore from Karnataka, as it is cheaper, despite higher freight rates, than buying from the Odisha miners.
Jharkhand-based steelmaker, Electrosteel, booked 8,000 t of iron ore lumps (Fe 62.56%) from NMDC Karnataka at INR 6,719/t (basic). The landed cost of lumps in Jharkhand is estimated at around INR 11,500/t. On the other hand, offers for lumps (5-18mm, Fe 63%) floated by Odisha miners are at INR 14,000-14,700/t exw.
Apart from Electrosteel, West Bengal-based Orissa Metaliks booked 72,000 t of fines (Fe 64.5-65%) at INR 6,032-6,930/t (basic) from Karnataka-based private miners.
While interacting with SteelMint, one buyer said that he was buying material from afar despite high transportation cost, which may pressure iron ore prices in Odisha.
OMC to auction nearly 0.8 mn t of iron ore fines next week
State-owned miner Odisha Mining Corporation (OMC) has scheduled an iron ore fines e-auction on 8 Jul’21. The total quantity to be auctioned stands at 799,000 t. The material to be offered will be from OMC’s Gandhamardan, Daitari, Koira, Jilling, Tiring Pahar and Guali mines. The base price of the auction is expected to be decided on 5 Jul, as per SteelMint reports. At 13.3 mn t, OMC’s iron ore production witnessed a straight 7% growth in FY’21 as against 12.38 mn t in the previous fiscal.
Odisha iron ore prices:
Recent trade and rationale:
- No deal has been concluded this week and, therefore, not considered under T1 trade, being accorded 0% weightage in index calculation for Fe 62% fines.
- SteelMint has received seven (07) offers, indicative prices under T2 trade in this publishing window and all were taken into consideration and given 100% weightage. To see SteelMint’s iron ore assessments, pricing methodology and specification documents Click here
28,000 t iron ore sold at SAIL’s Chhattisgarh auction
Steel Authority of India Ltd (SAIL) conducted an auction today for 28,000 t of iron ore fines from its Rajhara mines in Chhattisgarh. The entire material on offer received bids at INR 6,380/t (loaded, including royalty, DMF and NMET), according to market sources. The Fe 60.02% grade iron ore that was auctioned fetched bids which were higher by INR 180/t compared with the last auction held on 16 Jun’21.
Karnataka iron ore e-auction receives active response:
Leading PSU miner NMDC conducted an iron ore e-auction on 1 Jul’21 from its Kumaraswamy mines in Karnataka. The entire quantity of 112,000 t put to auction received bids, as per reports.
Jharkhand-based steelmaker, Electrosteel, booked 8,000 t of iron ore lumps (Fe 62.56%) at INR 6,719/t (basic).
JSW Steel, including Salem steelworks, was the leading buyer with 84,000 t.
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