India: NMDC hikes iron ore prices by up to INR 1,500/t ($20)

India's state-owned iron ore miner National Mineral Development Corporation (NMDC) has announced a price hike of 30% in fines and 10% in lumps w.e.f 12 May, SteelMint learned from credible sources.
The revised prices are as follows:

• DR-CLO (10-40 mm, Fe 67%) - INR 8,880 (+810)
  
  
• Baila lump (6-40mm, Fe 65.5%) - INR 7,650 (+700)
  
  
• Baila fines (Fe 64%) - INR 6,560 (+1,500)
  
  
• FoR prices on per tonne basis, royalty & taxes extra
  
  

Reasons behind hike in prices:

• Increase in prices by Odisha merchant miners: Odisha's Essel Mining has increased lump prices by around INR 1,600/t and fines prices by around INR 1,700/t w.e.f12May'21, sources told SteelMint. The revised offer for lump (5-18 mm, Fe 63%) stands at aroundINR 12,700/tonne (ex-mines, including royalty, DMF & NMET) and that of fines (Fe 62%) at INR 9,400/t.
  
  

• High bidding prices in OMC e-auctions:Odisha's state-owned minerOdisha Mining Corporation (OMC) had scheduled an iron ore e-auction on 10 May'21 for 1.37 mn t of iron ore fines. The entire quantity put up for auction was booked with bids increasing by upto INR 2,750/t (over 50%) against the set base price.
  
  

• Global iron ore prices trading at record highs:Global iron ore fines (Fe 62%) witnessed a sharp rise with prices touching $229.55/t, CNF China, as assessed on 10 May. The prices have increased on robust demand post-Chinese Labour holidays on attractive steel margins. The prices are the highest since CY'09, as per data maintained with SteelMint.
  
  
• Supportive steel prices:SteelMint's benchmark prices for 2.5mm thickness HRCs stood at INR 66,500-67,500/t and CRCs at INR 80,500-81,500/t ex-Mumbai on 5 May'21. The prices mentioned above are exclusive of GST @18%.Despite the possibility of domestic demand being moderate due to rising covid-19 cases, we expect domestic steel prices to remain elevated on the back of favourable international price trends.
  
  

NMDC recorded total iron ore production of 34.11 mn t in FY21, 8% higher than 31.49 mn t in FY20.