Vizag Steel Resumes Iron Ore Purchase from Karnataka E-auctions
Rashtriya Ispat Nigam Limited - public sector enterprise has resumed iron ore purchases from Karnataka e-auctions after a gap of 1 month. In the e-auction conducted on 17th Sept, the steelmaker procured fines and lump from NMDC Kumaraswamy mines. Prior to this, it had procured material from Karnataka in July.
In the month of Sept’18, RINL purchased total 2,00,000 MT iron ore from NMDC Kumaraswamy. Out of total iron ore purchased, lumps were 64,000 MT for Fe 63% grade at the bid price of INR 3,312/MT and remaining 136,000 MT fines (Fe 61%) at the bid price of INR 2,578/MT. Prices mentioned are basic, GST and other taxes extra.
RINL has been procuring iron ore from Orissa Mining Corporation and NMDC (Chhattisgarh) and had prior to this had participated in the Karnataka e-auction in the month of July’18. They had purchased 0.28 MnT iron ore fines in the month of July from NMDC Donimalai.
Why has RINL resumed purchases from Karnataka e-auctions?
1. Limited production in Odisha amid monsoons - Odisha iron ore production has suffered amid monsoons resulting in fall in volumes. Odisha’s iron ore production was recorded at 6.82 MnT in July down 25% against 9.14 MnT in the previous month. OMC’s iron ore production fell to 0.21 MnT in July compared to 0.89 MnT in June’18.
2. Less dispatches from NMDC (Chhattisgarh) - Due to monsoon, NMDC (C.G) production was hampered resulting in fall in dispatches. NMDC (C.G) production had down by 7% M-o-M to 0.67 MnT stood against 0.72 MnT in the last month. RINL depicted decline in procurement from NMDC Bailadila mines for the fourth consecutive month by 14% in Aug'18 to 101 rakes as against being 117 rakes a month before and 155 rakes in Jun’18.
3. RINL’s expansion plans - The company has recently increased its steel capacity from 6.3 MnT to 7.3 MnT pa.
source: SteelMint
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