With viability of the imported ore getting narrowed down following increase in global prices, few steel makers in west India are looking out for sourcing iron ore from Odisha.
A market source in conversation with with SteelMint shared that west India based steel makers are looking out for sourcing iron ore from Odisha. In the current scenario, the landed cost of Odisha lump (Fe 63%) to Kandla will remain at INR 4,500/MT considering coastal movement from Dhamra port to Kandla port. However, if rail route from Odisha to Kandla is taken into consideration, the landed cost will be comparatively costlier and stand at INR 5,700-5,800/MT.
Steel plants in west India using imported lump bought in Apr’16
SteelMint in conversation with a Gujarat based steel maker shared that “Currently we are using the imported lump that we had imported in Apr’16 at around USD 65/MT, CFR Kandla. The landed cost for it stands around INR 4,900/MT. However with sharp hike in global iron ore prices, importers have turned resilient with imported offers becoming costlier.”
Apart from this, we also source domestic pellets from Jindal SAW and iron ore from Karnataka e-auctions, he added further.
West India based plants sourcing from Karnataka e-auctions
Gujarat based steel plants are seen sourcing iron ore from Karnataka e-auctions. The road freight from Karnataka to Gujarat is around INR 1,800-2,000/MT. Hence the landed cost of lump (Fe 63%) bought in Karnataka e-auction will stand at around INR 4,400-4,500/MT.
Railway freight for carrying iron ore from Karnataka to Gujarat is comparatively higher and is around INR 2,900-3,000/MT because of which road transport is preferred over rail transport by Gujarat based steel units.
Jindal SAW pellet offers at INR 5,700/MT, delivered Kandla
Pellet offers of Jindal SAW are at INR 5,700/MT, delivered Kandla for Fe 63% pellets and INR 6,000/MT, delivered Kandla for Fe 65% pellets.
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