India: Karnataka Iron Ore E-auction Sales likely to be highest in July

1.8 MnT Iron ore has been sold till now via Karnataka e-auctions in July, 2014 which is higher against previous months of FY15. This is certainly because of acute Iron ore shortage prevailing in the domestic market owing to imposition of mining ban.

Viewing the results of last six Karnataka e-auctions conducted by MSTC, it can be perceived that buyers prefer high grade Iron ore over low grade.

Summary of the last Six E-auctions

1. Out of 1.5 MnT Iron ore offered, 0.56 MnT was sold
2. Entire Iron ore that was offered by NMDC was sold out owing to its high grade
3. The e-auction held on 10 Jul, 2014 received an overwhelming response as 86% of the offered quantity was sold, as it comprised of high grade
4. JSW Steel was the largest buyer at 352,000 MT followed by MSPL

556, 000 MT Iron Ore sold via Karnataka E-auctions

Qty in MT Source: SteelMint Research

Overview of E-auctions held in July, 2014

1. Considering the e-auctions till 20 Jul 2014, JSW Steel procured 1.3 MnT, which is the highest purchase in FY15
2. The bid price for fines (Fe 60%) has fallen from INR 2,648 /MT in June, 2014 to INR  2,436 /MT in July, 2014
3. The bid price for lumps (Fe 63%) are almost at similar levels (M-o-M) and is at INR 3,962 /MT in July, 2014

Note: Grade & bid prices are weighted average.