Odisha Mining Corporation (OMC) has recently put forward an e-auction for 405,000 MT iron ore to be held on 26 Feb’16. The material has been offered from Barbil, Daitari and Koira mines.
The company has notified a sale of 405,000 MT iron ore (304,000 MT CLO & 101,000 MT fines). In addition, the company has not corrected its base prices for the majority of material offered for e-auction. However, a slight correction of INR 100/MT for Barbil Fe 62-60 fines, INR 150/MT for Daitari Fe 62-60 fines has done.
If we talk about previous few auctions, those received luckluster response and ended up with pilling up of unsold quantities. This was also due to higher base prices.
Currently, as the company didn’t reduced any base prices for the upcoming e-auction, few market participants feel that the e-auction would draw lukewarm response on 26 Feb’16.
However, if the situation persists, the company will be forced to reduce its base prices for the next few e-auction tunning with the outlook of the market prices.
Base price comparison of OMC iron ore e-auctions
| Mines | Size (mm) | Fe (%) | Base Price on 26 Feb’16 |
Base Price on 13 Jan’16 |
Base Price on 26 Sep’15 |
Change (%) |
Quantity (MT) |
| Barpada Kasia (Barbil) | 10-40 | 62 | 1,600 | 1,600 | – | – | 4,000 |
| -10 | 62-60 | 900 | 1,000 | – | 10% | 12,000 | |
| Kurmitar (Koira) | 10-40 | 62 | 1,750 | 1,750 | – | – | 200,000 |
| -10 | 62-60 | 900 | 900 | – | – | 50,000 | |
| Daitari | 10-40 | 62 | 1,750 | 1,800 | – | 2.7% | 100,000 |
| -10 | 64-62 | 1,350 | 1,400 | – | 3.5% | 35,000 | |
| -10 | 62-60 | 1,200 | – | 1350 | 11% | 4,000 | |
| Total |
405,000 |
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Base prices in INR/MT on ex-mines basis; including of royalty
Source: SteelMint Research
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