India: Karnataka Iron Ore E-auction Prices Shoot Up Amid Tight Availability

Karnataka iron ore bid prices for high grade ore have witnessed a sharp rise in recent e-auctions .

The prices of iron ore fines (Fe 65%) offered from Vyasankere mines fetched bids of around INR 1200/MT to INR 4,140-4,160/MT over the base price of INR 2,950/MT in recent e-auction held on 14th Feb’2020. Prices mentioned are basic and royalty, bulk permit processsing fee & GST extra. 20,000 MT fines was sold from this lot. The prices have increased amid tight availability as few miners have heard to have finished EC limit for this fiscal leading to reduced material availability in the market.

The bid prices have picked up by about INR 400/MT against the last bid at INR 3,760/MT for the auction held towards the beginning of the month (6th Feb’20).

In another lot booked in 14th Feb'20 auction, fines (Fe 62.3%) offered from P Balasubba Setty & Sons was booked at INR 3,840-3,850/MT (basic) against set base price of INR 2,800/MT (basic). 36,000 MT fines was booked in this lot.

However few lots of low grade fines (Fe 58.5%) offered from Vedanta fetched flat bids at INR 1,670/MT against set base price of INR 1,670/MT. 92,000 MT fines got booked.

Karnataka e-auction sales volumes dropped down sharply by 38% in Jan’20 to 2.25 MnT as compared to 3.6 MnT in Dec’19. Karnataka's monthly iron ore sales hit almost eight months low in Jan'20 as similar levels were last seen in May'19 at 2.3 MnT. As per the sources, Karnataka iron ore miners have sold out most of their material hence they had less material to offer in the month of Jan'20.

Amid shutdown at various pellet plants, offers for the week in Bellary have depicted a rise to INR 7,100-7,200/MT ex-Bellary last week as against INR 6,900/MT a week ago.