OMC has scheduled its next iron ore lump e-auction on 1st June’20. The auction is being conducted for for 571,500 MT iron ore lumps, out of which 570,000 MT is DR-CLO and remaining 1,500 MT is lumps.
They have reduced the base price, substantially from the last lump auction held on 28th Apr’20. The base price for material offered from Koira mines reduced by INR 450/MT, from Daitari mines reduced by INR 600/MT and that of Gandhamardhan mines by upto INR 350/MT.
SteelMint also learned from its sources that last week, Kalinganagar Industries Association had put up a request to OMC to lower iron ore base price for auctions so as to enable restart of steel industries in Odisha to make up for losses in COVID-19.
Odisha based merchant miners have received decent response in iron ore lump bookings after the recent price cut announced. On 19th May’20, Serajuddin Mines decreased iron ore lump offers by INR 500/MT. Essel Mining had cut offers for both 5-18mm and 10-30mm lumps w.e.f 16th May 2020, with prices down by around INR 1200/MT against the last revision in Mar’20. Offers for 10-30 mm iron ore lumps from a major Odisha miner stands at around INR 2,900/MT (ex-mines, including Royalty, DMF & NMET).
OMC iron ore e-auction details
| Mines | Size | Fe (%) | Base Price as on 28th Apr’20 | Bid Price as on 28th Apr’20 | Base Price as on 1st June’20 | Quantity Offered |
| (mm) | (INR/MT) | (INR/MT) | (INR/MT) | (MT) | ||
| Gandhamardan | 10-40 | 62% | 2,350 | 2,350 | 2,000 | 350,000 |
| 10-180 | 65% | 2,100 | – | 1,850 | 1,500 | |
| Kurmitar (Koira) | 10-40 | 62% | 2,650 | 2,650 | 2,200 | 100,000 |
| Daitari | 10-40 | 62% | 2,800 | – | 2,200 | 120,000 |
| Total | 571,500 | |||||
Base prices in INR/MT on ex-mines basis; including royalty
Source: SteelMint Research
In the last lump e-auction held on 28th Apr’20, auction witnessed dull participation with only 18% of the material getting booked at the set base price.
Odisha- India’s largest iron ore producing state recorded total merchant iron ore dispatches at 1.31 MnT in Apr’20, down 79% as against 6.34 MnT in Mar’20. The figures exclude movement for export and dispatches of miners- SAIL & Tata Steel. Iron ore dispatches fell owing steel production cuts amid lockdown.
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