Monday, December 27,
State-run NMDC is likely to raise iron ore prices by three per cent next week for the January- March quarter, a move which could prompt domestic steel makers like JSW and Tata Steel to increase prices in the New Year.
“NMDC may increase prices of iron ore by 3 per cent from January,” an official of the company said on conditions of anonymity.
The official added that “the move is due to a rise in demand and squeeze in global supplies”.
When contacted, NMDC Chairman and Managing Director Rana Som said the prices would be decided by the pricing committee next week.
“The pricing committee will take a final decision on iron ore prices. It is meeting in Hyderabad on December 29 to decide the prices, which are fixed quarterly,” Som said.
After a series of hikes in iron ore prices during the first half of 2010, NMDC had reduced prices by about 5 per cent for the October-December quarter.
Earlier, the company had hiked ore prices by about 90 per cent for the April-June quarter to touch between USD 120 to 135 a tonnes. In the subsequent quarter (July-September), prices were raised to about USD 145 a tonne.
Steel industry sources said that the hike will affect all the steel companies, which are using iron ore and they will be forced to increase their prices as well.
After contacting Mr Anil Nachrani, President of Chattisgarh Sponge Manufacturer association, he said price hike is unjustified and they will appeal to NMDC and CG govt not to raise iron ore prices. According to him steel industry was going through a rough time for quite some time and it had just started getting back on track, on this hiking iron ore prices will affect the entire Steel Industry.
Official comments from major steel producers like JSW, Essar and Tata Steel could not be obtained.
SAIL, the largest domestic steel producer, is unlikely to be impacted by this hike as it meets its requirements through the captive iron ore reserves.
NMDC, which produced 24 million tonne of iron ore last year, exports about 3 million tonne of iron ore per annum to Japanese and Korean steel mills at prices which form the benchmark rate for domestic consumers.
Source: The Economic Times
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