Indian government-owned miner, National Mineral Development Corporation (NMDC) has reduced iron ore prices by Rs1,000/mt ($13.6/mt) for both lumps and fines for September deliveries from the prior month. This price cut was made effective from Sep 4.
NMDC’s iron ore lumps will be priced at Rs6,150/mt ($83.93/mt) and fines at Rs5,160/mt ($70.4/mt), according to a company release at BSE. NMDC sells over 70pc of its production volume in the form of fines.
These prices are excluding royalty, District Mineral Fund (DMF), National Mineral Exploration Trust (DMET), cess, forest permit fee, and other taxes.
Following a decline in iron ore prices by NMDC, domestic pellet prices in the Bellary region are likely to drop by Rs300/mt at the minimum. Industry sources suggest NMDC could auction iron ore in Karnataka on Wednesday, which would shed light on the actual base price reduction.
Before the price cut, the company had lowered iron ore prices by Rs300/mt ($4/mt) for lumps and by Rs200/mt ($2.7/mt) for fines for August deliveries from the preceding month.
Over the past month, international iron ore prices declined by around $40/mt. With continued production cuts in China, daily spot prices for iron ore (Fe 62pc) were at $131.5/dmt cfr North China on Monday, down by $13.5/mt from Friday’s close.
The international supply of iron ore could ease further with lower demand and consumption by the largest consumer, China, and recovering production in Brazil, Australia, and India.
In August, NMDC reported an 88.89pc surge in iron ore production to 3.06mn mt from the previous year.
Indian pellet sponge prices in the domestic market decreased on Tuesday by Rs400/mt to Rs29,500/mt ex-works Raipur. It was also lower by around Rs1,500/mt from the prior month.
($1=Rs73.29)