India: Karnataka iron ore e-auctions sales volumes down in Apr'23

Karnataka iron ore e-auctions sales volumes decreased by 48% m-o-m to 1.30 million tonnes (mnt) in April 2023 from 2.51 mnt in March, as per SteelMint data. Out of the total material sold, there were 0.9 mnt of fines and 0.4 mnt of lumps.

Due to logistic and road transport issues in the region, dispatches were an issue from some mines. Perhaps it may be possible that in the last month auction buyers were not shown interest as they bought decent material did a month before. This resulted in a hike in Bellary pellet prices last month which increased by INR 650/t m-o-m to INR 9,800/t exw Bellary.

Also, sponge prices (P-DRI) from Bellary increased on an average by around INR 800/t m-o-m to INR 30,700/t in Apr'23.

Auction highlights

NMDC's sales down sharply in April - NMDC, India's top iron ore miner, auctioned 848,000 t of material from Karnataka in the month of April 2023 down 55% down m-o-m against 1,874,000 t in March. Out of total 1,298,000 t, iron ore fines sold 896,000 t and lump ore were sold during the month.

KSMCL became the second leading miner and sold 2,32,000 t iron ore via auction in April against 2,21,000 t in March. Followed by SIMORE who had sold 1,60,000 t of iron ore from its mines in April, 2023.

Vedanta iron ore volume decreased by 42% m-o-m to 44,000 t in April compared to 76,000 a month ago. Vedanta's entire quantites were iron ore lump.

Karnataka auction miners

Prices up slightly by INR 100-200/t - The monthly weighted average price of iron ore fines up by around INR 100/t and lumps at around INR 200/t. Price of fines Fe 60% stood at INR 3,000/t and that of lumps Fe 63% was recorded at INR 3,650/t ex-mines, excluding taxes.

India's total iron ore production is estimated at 255 mnt in FY23, up by 2 mnt compared to 253 mnt in the preceding fiscal. Karnataka was the third largest iron ore-producing state with 38 mnt.