India: OMC Iron Ore Auction Fetches Bid Higher by upto INR 800/t ($12.5)

Bhubhaneshwar (India)- Odisha Mining Corporation (OMC), a state-owned miner has received overwhelming response for its recent auction of 390,000 MT iron ore fines, scheduled on 6 Jan'18 , from Gandhamardan, Daitari and Koira mines. OMC is the one of the largest merchant iron ore miner in the state, with an annual production of around 5-5.5 million tonnes.

According to market sources, miner received highest bid for its 60-62% Fe fines from Kurmitar and Gandhmardhan mines at INR 1,600/t ($25.3), for which base price was set at INR 950-1,000/t ($15.5). Total quantity offered from these two mines was 300,000 MT.

Whereas, Daitari's 62-64% Fe iron ore fines (90,000 MT) received highest bid at around INR 2,700/t ($42.8), for which base price was set at INR 1,900/t ($30). All prices are on ex-mines basis and including royalty, DMF and NMET.

OMC has raised floor prices on this occasion at the latest e-auctions. This is because private miners have been raising prices on closure of some large mines in the state post supreme court's order. Notably, Indian court had asked miners to pay penalty,which was set by CEC, by 31st Dec or shut operations. Against which few large miners like MESCO, Serajuddin and three others failed to submit their dues on time.

Offers from private mines for 63% Fe iron ore fines are hovering at around INR 2,200-2,400/t ($33.3) and CLO (Calibrated Lumps Ore) at around INR 5,000-5,200/t ($81), ex-mines, including royalty, DMF and NMET.

Base price comparison of OMC iron ore e-auctions-

Base prices in INR/MT on ex-mines basis; including royalty
Source: SteelMint Research