The government is likely to increase the volume of iron ore
marked for auction in Karnataka among steel mills which base their production
on ores mined from the state, said people connected with the development.
The government currently auctions 400,000 tonnes of iron ore every week through
the electronic auction route.
The move to raise volumes, if implemented, will bring relief to steel companies
who have been unhappy over the high reserve price that was fixed by the
state-run MSTC, which is conducting the e-auction. The first e-auction was done
on September 14 and the next is scheduled on September 21.
The ore that is auctioned are in fines and lump form, with the low grade fines
being priced at 2,700 a tonne. This is higher than the price of about 1,500 to
2,000 a tonne in the open market, said one steel trader.
The lumps with ferrous grade of 65% and above, have been priced at 3,700 a
tonne.
“Prices are on the higher side and they have been a cause for concern for
us,” said Jayant Acharya, a commercial director with JSW Steel, the
country's largest steelmaker, which is based out of Karnataka.
“Industry representatives from the state have presented this feedback and
discussions are being conducted with the monitoring committee that has the
responsibility of fixing production sizes and prices,” Acharya added.
Source: The Economic Times
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