India: Karnataka iron ore e-auction sales volume down 13% in Aug’21

Karnataka registered a 13% m-o-m decline in its monthly e-auction sales volumes in Aug’21. The total allotted iron ore quantity in Aug’21 was recorded at 2.35 million tonnes (mn t) as against 2.69 mn t in July’21.

JSW’s iron ore sourcing from Karnataka down 18%: Purchases by JSW Steel, the largest buyer of Karnataka’s auctioned iron ore, dropped by 18% in Aug’21. JSW Steel purchased around 1.07 mn t of iron ore from the Karnataka e-auctions last month against 1.3 mn t in July’21. The company, on a monthly average basis, procures roughly 1-1.5 mn t from the Karnataka e-auctions for its Vijayanagar and Salem plants.

Purchases from Vijaynagar plant stood at around 0.96 mn t for the month against 1.16 mn t in Jul’21. The procurement dropped mainly due to a planned shutdown at one of its converters at Vijayanagar works.

Out of the total 1.07 mn t sourced, NMDC supplied 0.52 mn t (up from 0.48 mn t in Jul’21), accounting for around 49% of the total JSW Steel’s sourcing.

Vedanta remained the second-largest iron ore supplier to JSW Steel at 0.31 mn t against 0.35mn t in Jul’21.

Sales from NMDC up m-o-m:NMDC sold 0.93 mn t of iron ore via the Karnataka e-auctions in Aug’21 against 0.79 mn t in the previous month, (including production from the Donimalai mines). NMDC’s Donimalai mines sold around 0.47 mn t last month.
Iron ore sales from Vedanta were recorded at 0.50 mn t in Aug’21 against 0.43 mn t in Jul’21.

Buyer-wise allotted quantity in Aug’21 iron ore e-auctions

Qty in tonnes (t)
Source: GOK, DMG, SteelMint Research
All prices mentioned are basic, taxes extra

Highlights of Aug’21 Karnataka iron ore e-auctions-

• Vedanta procured 52,000 tonnes (t) of iron ore, of which 20,000 t were fines (Fe 55.5) and 32,000 t were lumps (Fe 63.78%-66%).
• Western India-based pellet maker Jindal SAW bought 12,000 t of iron ore fines (Fe 62.55) at INR 5,840/t from P. Balasubba Setty& Son.
• Rashtriya Ispat Nigam Limited, a public limited company, bought around 28,000 t of iron ore fines (Fe 59%) at INR 4,292/t and 80,000t of iron ore lumps (Fe 61%) at INR 5,755/t. Entire purchase was from NMDC’s Donimalai mines. All prices mentioned are basic, taxes extra.
• Eastern India based Electrosteel Casting Limited booked 20,000 t of iron ore lumps at the Karnataka auctions at INR 6,006-7,300/t.