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India: Karnataka's iron ore e-auction sales volumes recover m-o-m in Feb'24

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Fines/Lumps

BigMint Bureau

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13 Mar 2024, 11:14 IST

India: Karnataka's iron ore e-auction sales volumes recover m-o-m in Feb'24

Iron ore e-auction sales volumes in Karnataka increased by 22% m-o-m to 1.17 million tonnes (mnt) in February 2024 from 0.96 mnt in January 2024, as per BigMint data. Out of the total volume of iron ore sold via auctions, 576,000 tonnes (t) of fines, and 592,000 t of lumps were sold during the month.

Auction volumes have recovered this month, as volumes were much lower during last month than the usual average. Usually in the last one year, average auction volumes were around 1.5 mnt owing to shift in preference towards direct sales.

Auction sales rise by 13% in NMDC's auction - NMDC, India's top iron ore miner, auctioned 835,000 t from Karnataka in February 2024, higher by 13% m-o-m as against 740,000 t in January 2024. Out of the total volume of iron ore, 468,000 t of fines, and 367,000 t of lumps were sold during the month.

Other miners' iron ore sales via auction outcomes:

SMIORE emerged as the second-leading miner by selling 161,000 t of iron ore in February 2024, a significant rise of 148% m-o-m against 65,000 t in January 2024.

KSMCL sold 160,000 t of iron ore via auctions in February, 2024. However, sales recorded a hike of 54% against 104,000 t in January, 2024.

Vedanta sold 12,000 t of iron ore sales in February 2024. Whereas, it has not conducted any auction in January.

Iron ore prices drop m-o-m: The monthly weighted average prices of iron ore lumps and fines dropped m-o-m. Weighted average prices of Fe 60% fines stood at INR 3,900/t, a fall of INR 250/t m-o-m and that of Fe 63% lump prices at INR 4,850/t, a decrease of INR 300/t m-o-m. Prices are exclusive of taxes. The drop in prices was due to fall in exports and decrease in pellet and sponge prices. BigMint's Bellary pellet index fell from INR 10,650/t in February, 2024 against INR 10,900/t exw in January, 2024.

Currently, miners are holding small stocks for auction but the market is still facing a shortage of raw materials owing to exhausted environmental clearance (EC) limits for Karnataka miners.