Iron ore price offers remained firm in Odisha as some miners like Rungta Mines and KJS Ahluwalia increased offers in January tracking the firm sponge iron and steel prices, industry sources said.
While Rungta increased lumps offers by ₹400-500 per ton and fines offers by ₹300 per ton, KJS Ahluwalia increased lumps offers by ₹500 per ton and fines offers by ₹300 per ton.
Meanwhile, NMDC limited increased the prices of lump ore and to ₹3,100 and ₹2,760 weight per metric ton with effect from January 2, 2018, from ₹2,600 and ₹2,260 weight per metric ton in December 2017 respectively, the company said in a BSE filing.
India’s iron ore production surged by 22 percent in the financial year (FY) 2016-17 to 194 million tons (mt) from 156 mt in FY16. Of the total production, steel industries consumed 126.67 mt and around 25 mt were exported. The rest 40 mt low-grade material got added to the mine heads.
In FY18, India is likely to produce around 200-205 million tons of iron ore, industry sources said.
Hike upsets steel mills
The hike in iron ore prices has upset domestic steel companies which are now bracing for a spike in production costs.
It is slated to affect both large steel majors who do not own captive iron ore mines as well as smaller and medium steel firms that rely on merchant ore supplies to feed their units.
Companies fear, along with price increase in coal, refractory and other raw materials , it will force them to raise steel prices, sources said.
The price increase will spiral inflationary trend as steel prices will go up to absorb the increased prices of fines, they said.
“It will also impact steel production by smaller producers as cost increase and additional cash flow will restrict production,” sources added.
Hike to impact consolidation
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