The first ever online auction of Iron ore by Odisha Mining Corporation (OMC) was conducted on 27 Oct, 2014 for 365,000 MT Iron ore lumps through MSTC. Today, 417,000 MT fines was offered and the e-auction has received bid prices higher than the base prices.
Bid prices have moved up by 20% in contrast to base prices owing to scarcity in the domestic market. The auction was opened for steel mills based outside Odisha as well; both traders and end-users have participated.
OMC’s H1 Bids in 1st Iron Ore E-auction
|
Mines |
Size (mm) |
Grade |
Quantity |
Base Price |
Bid Prices |
% Change |
|
Barbil |
-10 |
62-60% |
12,000 |
2,700 |
3,150 |
17 |
|
Daitari |
-10 |
64-62% |
1,00,000 |
3,000 |
3,450 |
15 |
|
Daitari |
-10 |
62-60% |
50,000 |
2,800 |
3,250 |
16 |
|
Koira |
-10 |
62-60% |
30,000 |
2,600 |
3,450 |
33 |
|
Gandhamardhan |
-10 |
62-60% |
165,000 |
2,500 |
2,900 |
16 |
|
Gandhamardhan |
-10 |
60-54% |
60,000 |
1,400 |
1,700 |
22 |
Ex-Mines prices in INR/MT including royalty
Participants mentioned that after the Supreme Court’s order of suspending mines running under second deemed renewal, the availability of Iron ore has become very critical in the country. Most of the merchant mines have been closed and whoever is operational is overbooked.
Rungta Mines is offering Fe 63% Iron ore fines at INR 3,200/MT (as per loaded to wagons, including royalty).
In Sep’14, OMC had proposed the state government to sell 50% of Iron ore produced by it through online auction to end-users. While, the rest of the mineral output are to be provided to companies based on a 5-year supply pact. The user companies have signed agreement with the state government and are currently in operation. Price of such long-term linkage will be fair market price as discovered through the e-auction conducted by OMC for the remaining 50% material.
In the first e-auction, the company has earmarked 417,000 MT Iron ore fines and 365,000 MT Iron ore lump of different grades. The company had produced about 2 MnT Iron ore in FY14.
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