South India: Steel Makers Prefer Domestic Iron Ore Over Imported Ore

With one iron ore import vessel, southern India based pellet and steel makers focused more on domestic iron ore/pellet sourcing in Feb’17.

Base prices in Karnataka e-auctions moved up in Feb’17 – NMDC hiked iron ore base prices for Feb’17 e-auctions up to INR 115/MT M-o-M.

In Feb’17, base prices for NMDC Donimalai mines remained as follows – Lump (Fe 62.5%) – INR 2,519/MT and fines (Fe 60.2%) – INR 2,165/MT. Base prices for NMDC Kumaraswamy mines in Feb’17 e-auctions remained as follows – Fines (Fe 62.4%) – INR 2,220/MT and lump (Fe 63.8%) – INR 2,558/MT.

Talking about private miners – Vyasankere iron ore mines lump prices increased by INR 110/MT M-o-M in Feb’17. Base price of Lump (Fe 65%) was at INR 2,830/MT and fines (Fe 65%) was at INR 2,660/MT. (All prices mentioned are basic).

KIOCL imports iron ore from Iran, other importers adopted domestic iron ore sourcing – High global iron ore prices kept importers away from booking fresh vessels. In Feb’17, only one import vessel was noticed by southern India parties. KIOCL imported 59,900 MT fines from Iran. The vessel arrived at anchorage in Mangalore port on 18 Feb’17. The pellet maker is also sourcing iron ore from NMDC (Chhattisgarh) and Odisha based Kaypee Enterprises. Apart from this, no other southern India based steel maker imported vessel in Feb’17.

Jeevaka Industries procured 13,000 MT lump (Fe 58.5-59.1%) from SMIORE via Feb’17 e-auctions at bid price of INR 2,140-2,300/MT (basic).

Price scenario of sponge grade lump in Feb’17 Karnataka e-auctions – Sponge grade lump (Fe 62.5%, 10-20 mm ) offered by NMDC Kumaraswamy mines was base priced at INR 1,972/MT. The lot was sold at INR 1,992-2,272/MT.

Andhra Pradesh based steel maker – Steel Exchange India continues to source iron ore from NMDC (Chhattisgarh).

Bellary pellet offers rise amid increase in P-DRI prices – Bellary pellet prices declined to INR 5,500/MT by mid of Feb’17. However later amid increase in P-DRI prices, southern India based pellet makers raised offers. Pellet (Fe 63%) offers increased and are presently seen at INR 5,800-5,900/MT (basic).