Karnataka’s monthly iron ore e-auction sales volumes have picked up in the month of Oct’20. The total allotted quantity in Oct’20 was recorded at 2.3 mn t, up marginally when compared to 2.22 mn t in Sep’20.
The iron ore e-auctions were suspended in Karnataka owing to some technical issues. However later auctions resumed from 14th Oct’20, resulting in hike in bids in the auctions conducted largely by private miners. Bids surged by around INR 2,000/t over the set base price for material put to auction by private miners. For material put to auction by NMDC Kumarswamy mines bids increased upto INR 200/t. Notably, bids increased by INR 1,760/t over the set base price for high-grade (Fe 62% & above) in Oct’20.
JSW Steel’s iron ore sourcing from Karnataka down 14% m-o-m
JSW Steel – the largest buyer of Karnataka iron ore bought 47% to the total iron ore sold in Karnataka e-auction last month. In the month of Oct’20, the company sourced around 1.08 mn t iron ore, down 14% against 1.25 mn t in Sep’20.
Out of 1.08 mn t iron ore sourced by JSW in Sept’20, NMDC Kumarswamy mines supplied 0.35 mnt in Oct’20, contributing 32% of total sourcing as compared to 0.45 mn t in Sep’20. Vedanta remained the second-largest iron ore supplier to JSW Steel and supplies stood at 0.33 mn t in Oct’20 against 0.36 mn t in Sep’20.
JSW Steel has commenced production from two captive mines in Karnataka from 25th Sep’20 out of the three newly acquired mines. The operations from the third mine is expected to commence soon. Overall dispatches from captive mines in second-quarter constituted 27% of iron ore requirements of the company, officials highlighted in Q2 FY21 results.
NMDC’s iron ore sales stable m-o-m
NMDC sold 0.63 mn t of iron ore via Karnataka e-auctions in Oct’ 20, stable om monthly basis. With operations remaining on hold in Donimalai, all the sales made were from its Kumaraswamy mines.
Karnataka government has granted permission to India’s largest iron ore miner, NMDC to start mining operations at Donimalai mines. The resumption of mining operations in Donimalai is expected to start shortly, Mr. Sumit Deb, CMD NMDC informed in the annual general meeting. NMDC’s Donimalai mine has an EC limit of 7 mn t pa.
Buyer-wise allotted quantity of Oct’20 iron ore e-auctions:
Qty in t
Source: GOK, DMG, SteelMint Research
Highlights of Oct’20 Karnataka iron ore e-auctions-:
- Western India based pellet maker – Jindal SAW bought 16,000 t iron ore fines (Fe 63.22%) at INR 3,580/t, INR 730/t above the set base price.
- Vedanta supplied 60,000 t iron ore lumps (Fe 58-60.5%) at INR 3,448-3,516/t. The company also procured around 380,000 t fines (Fe 57.5-58.5%) at INR 1,695-1,842/t.
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