India: Karnataka Iron Ore E-auction Sales Up 21% Y-o-Y in CY'19 on Increased JSW Buying
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Karnataka iron ore e-auction sales volume increased 21% Y-o-Y in CY'19. Total iron ore allotted quantity was recorded at 31.16 MnT in CY'19 compared to 25.69 MnT in CY'18.
On monthly basis, Karnataka e-auction sales also increased by 37% in Dec'19 to 3.6MnT as compared to 2.62 MnT in Nov'19. Karnataka's monthly iron ore sales hit almost four years high in Dec'19 as similar levels were last seen in Mar'16 at 4.03 MnT.
JSW Steel's iron ore sourcing from Karnataka e-auctions increased sharply by 34% in CY'19-: JSW Steel's iron ore purchases from Karnataka e-auctions increased significantly by 34% to 18.65 MnT in CY'19 compared to 13.88 MnT in CY'18. Out of 18.65 MnT iron ore sourced by JSW in CY19, NMDC supplied 7.05 MnT up 5% as against 6.74 MnT last year (CY'18) and thus contributed around 38% of total JSW sourcing.
JSW iron ore sourcing from other private mines increased sharply by 62% to 11.6 MnT as against 7.14 MnT in last year.
Operations at NMDC's Donimalai remaining on hold since Nov'18, all the supplies made in CY19 from NMDC to JSW Steel were from NMDC Kumarswamy mines. In CY'18 NMDC Kumarswamy mines supplied 4.55 MnT to JSW steel out of total 6.74 MnT. Thus, NMDC Kumarswamy has increased around 55% supply to steelmakers in CY'19.
NMDC turned out to be the largest iron ore supplier-: NMDC was the largest iron ore supplier via Karnataka e-auction and sold 8.5 MnT iron ore via e-auctions in CY'19, down by 11% Y-o-Y against 9.59 MnT last year. Out of the total quantity sold by NMDC via e-auction, around 83% of the material purchased by JSW Steel and rest 17% by others.
Other major suppliers last year were-- Vedanta Ltd at 6.07 MnT, Vyasankere Iron Ore Mines stood at 2.05 MnT.
Buyer-wise allotted quantity of CY'19-:
| Company | Fines | Lumps | ROM | Grand Total |
| JSW Steel Ltd | 14,882,500 | 3,312,840 | 455,655 | 18,646,995 |
| BMM Ispat | 1,680,000 | 24,000 | - | 1,704,000 |
| MSPL Limited | 1,292,000 | - | 92,000 | 1,384,000 |
| Minera Steel And Power Private Limited | 645,975 | - | - | 645,975 |
| Rai Bahadur Seth Shreeram Narasingdas Private Limited | 343,676 | 111,000 | 128,530 | 583,206 |
| Thakur Industries | 321,315 | 175,736 | 53,925 | 550,976 |
| Others | 2,290,051 | 5,021,520 | 337,567 | 7,649,138 |
| Grand Total | 21,455,517 | 8,645,096 | 1,063,677 | 31,164,290 |
Qty in MT
Source: GOK, DMG, SteelMint Research
Major highlights of CY'19 Karnataka iron ore e-auctions-:
1. Rashtriya Ispat Nigam Limited (RINL) a public enterprise has bought around 156,000 MT iron ore lumps (Fe 62.2- 63.2%) from NMDC Kumaraswamy Mines only.
2. Electrotherm India Ltd - a Gujarat based company procured 100,000 MT iron ore lumps Fe 64.79% at INR 3,500-3,820/MT between Fe 63-65% grades. The largest supplier for CY'19 was P. Balasubba Setty & Son around 60,000 MT, Vyasankere Iron Ore Mines 28,000 MT and rest 12,000 MT by others.
3. Similarly, another western India based pellet maker - Jindal SAW has procured around 124,000 MT iron ore. Out of total 36,000 MT fines from P. Balasubba Setty & Son (32,000MT) and G.G Brothers (4,000MT). Rest 88,000 MT Lumps from P. Balasubba Setty & Son in CY'19.
4. Vedanta Ltd procured around 381,000 MT iron ore from e-auction, out of total 373,000 MT lumps and rest 8,000 MT iron ore fines from Veerabhadrappa Sangappa & Company and from own mines for its sponge plant in Goa.
