Monthly Archives: February 2014

India: NMDC’s Bailadila Mines Iron Ore Auction

National Mineral Development Corporation (NMDC) is a state-controlled mineral producer of Indian Government. NMDC’s Bailadila Sector (Kirandul & Bacheli) in Chhattisgarh offers sale of Iron ore through e- auction conducted by MSTC.

The material will be delivered on FOR/FOT mine basis. The last date for the submission of EMD & Online Forward Auction (OFA) document is up to 12.00 hrs IST on 06 Mar, 2014.

The date of auction is on same day i.e. 06 Mar, 2014, which is scheduled to commence between 13.00 to 15.00 hrs IST.

Details of the quantity offered

  • Lumps (Fe: 65.5-67%): 100,000 MT
  • ROM (Fe: 65.5%): 12,000 MT
  • Fines (Fe: 64-65%): 120,000 MT

Total quantity: 232,000 MT Iron ore offered for sale

For transportation of Iron ore, as per Government of Chhattisgarh order, a transit fee of INR 7/MT is collected by NMDC and paid to the CG forest division.

The transit fee will be in addition to Royalty, Sales tax/ VAT, Forrest development Tax, Forest permit fee  and labor welfare cess etc will be applicable at the time of supplies or that may be introduced in future are payable by the successful bidders.

 

India: Semi Finish Market inched up over Cautious Buying

Closing of the month and good buying sentiment of Re-bar in Mandi Gobindgarh (North) have improved the sentiments by INR 300-400/MT in major markets. However, trader said that the sales volume remains stagnant as buyer are cautious in Mumbai, Raipur, Durgapur & Rourkela markets.

Sponge prices remain under pressure with increasing Pellet availability and falling Sponge pellet prices along with low demand from Ingot/Billet buyers. The conversion gap from Sponge to Ingot/Billet is further increased by INR 200-400/MT mostly in Raipur, Durgapur & Rourkela.

Manufacturers believe that this price rally is due to improve sentiment as primary manufacturer increased price by INR 700-1,000/MT. However, actual demand of Finish Long is missing in the market. They also stated that Semi Finish trade volume will remain low owing to payment shortage & upcoming elections.

  • North India: Viability to purchase MS Billet from East & Central India (Raipur, Rourkela & Durgapur) improved
    Raipur selling Billet at around INR 30,400/MT to Mandi Gobindgarh on Ex-Raipur basis (Freight from Raipur to Mandi at INR 2,800-2,900/MT)
  • Rourkela offers Billet to Mandi at around INR 29,800/MT on Ex- Rourkela basis (Freight Rourkela to Mandi at INR 3,400/MT)
  • Durgapur continues sales of Billet to Mandi at around INR 30,500/MT on Ex-Durgapur basis (Freight from Durgapur to Mandi at INR 2,600/MT)
  • Local manufacturers based on Mandi offer Ingot at INR 34,650/MT on regular payment
 
wire

India: Secondary Wires Offers increased; Primary also in Line

GISecondary Wires market witnessed sudden price hike after 2-3 days downfall. Similarly, Primary players are also likely to increase its prices owing to high input cost. 

Raipur & Durgapur Wires prices stimulated by INR 200/MT in a day owing to price hike in Ingot and improved Finish Long demand in the market.

A native Wire Rod trader in Durgapur said, “Wire prices increased by INR 200/MT today as demand is improving from local and nearby states.”

Primary producers are also likely to increase Wire Rod offers for March, 2014.

Company’s official said, “SAIL may increase its Wire Rod offers by INR 1,000/MT for March, 2014 owing to high input cost and shortage of raw material.”

SAIL 5.5 mm Wire Rod price for Feb’14 was at around INR 43,000/MT (Ex-Chandigarh) which may increase by INR 1,000/MT to about INR 44,000/MT (Prices ED include; taxes extra).

Secondary Wires Prices as on 28 Feb, 2014

Item

Size

Durgapur

W-o-W

Raipur

W-o-W

MS Billet

100×100 mm

 30,550

+ 250

30,500

+ 100

Wire Rod

5.5 mm

 34,500

– 200

35,000

0

HB Wire

12 Gauge

 36,500

– 200

36,900

0

Binding Wire

20 Gauge

 41,400

– 100

 40,350

0

Note: Basic Price in INR/MT. ED and taxes extra

 

 
bukit-asam

Indonesia: PT Bukit Asam focuses on Port Infrastructure Development

PT Bukit Asam (PTBA) upgrades Tarahan port capacity by developing new jetty to accommodate cape size vessels. Company is expecting to complete the project and begin operations from the mid of 2014.

PTBA is the Indonesian state owned Coal miner and operating several Coal mines in Sumatera & Kalimantan. Tarahan Coal Terminal is located at Bandar Lampung, which is around 410 km far from PTBA, a fully owned Tanjung Enim mine .

Company is working towards increasing its capacities and developing its Tarahan Port Terminal to start serving cape vessels.

According to PTBA, the completion of Tarahan port expansion will increase company’s annual capacity to 25 MnT pa from existing capacity of 13 MnT pa. Once the port is ready for commercial operation, the port will operate a newly developed jetty. The new jetty will be able to accept cape size vessels of up to 200K DWT, in addition to the existing jetty with a capacity of berthing up to Panamax vessel of 80K DWT.

According to company’s website, the company currently is operating three stockpiles. The first stockpile handles Coal form its Air Laya & Muara Tiga Besar mining unit, the second stockpile handles Coal only from Muara Tiga Besar mining unit. Meanwhile, its third stockpile handles Coal from Banko Barat mining unit.

According to company’s financial statement for the year ended 31 Dec 2013, this expansion of port will be also supported by increased capacity of Coal stockpile to 0.86 MnT from existing capacity of 0.56 MnT. The stockpile also will be equipped with two new additional RCD (Rotary Car Dumpers) by July this year to support company’s mining as well as logistic operation.

In the meantime, the government of Indonesia is also planning to cap the Coal production to push the Coal prices to upwards. Once the government impalement the output cap or reject the Coal miners request to increase their Coal output in 2014, Indonesia may maintained the same output of 2013 or even lesser.

PTBA’s total sale of Coal is reached to 17.76 MnT in 2013. The company said in January 2014, it is planning to increase its Coal sales to 24.7 MnT in 2014, up 38% from its 2013 Coal sales of 17.76 MnT. PTBA has to increase its Coal output to utilize the full capacity of Tarahan Coal terminal’s, to achieve its goals.

-Sourced

 

India: Imported Manganese Ore Prices remain Firm

Prices of Manganese ore imported to India continued to remain stable this week — as they have since the start of the year. However, market sources reported of moderate demand from Manganese Alloys producers.

Manganese ore market has held steady since the last two months and International prices are more or less stable for imported Manganese ore. Demand in India is good as compared to China, which is experiencing lower demand and this has compelled Manganese ore miners to direct their efforts toward India and offer more quantities than usual. These days, South African Carbonated Manganese ore is highly sought after by Indian Manganese alloy producers and it has got more demand over other grades/origin. Demand for Indian Manganese alloys is good and prices have also improved. Hence, the Manganese ore prices are holding firm and there is a little possibility for major price fluctuation in the international prices.

South African Carbonated Manganese ore 37% is being offered at around USD 4.6-4.7/DMTU CIF India. BHP is offering 46% lumpy Australian Manganese ore at USD 5.5/DMTU CIF India. Although, there is a good demand for Manganese ore, the availability of the same remains low, primarily due to financial situation of the Ferro alloy industry as a whole. Currently, Manganese alloy producers largely have very limited capital to sustain operations, which as a result limits their purchasing power. The increased electricity prices have also played a spoilsport coupled with low power availability especially in Andhra Pradesh these days. However, situation is slightly better than before, for Ferro alloy industry in India and it could get better with the rising steel output in India and favorable International demand for Manganese alloys which will prompt more Manganese ore imports in India.

Comparison Between Manganese Ore Prices Across India

 Particular

 Grade

 Price in INR/MT 

 Price in USD/DMTU

Odisha

 28-30%

7,500

4.16

 

 42-44%

13,500

5.3

MOIL

30%

7,313

3.92

 

47%

14,510

4.97

Balaghat

 28-30%

6,600

3.66

 

 42-44%

13,500

5.3

South African Carbonate Ore(CIF India)

37%

10,932

4.7

Gabom

44%

14,192

5.2

Australia(CIF India)

46%

15,693

5.5

Exchange Rate: USD 1=INR 62.03

 

 
Coal Block

“Iron Ore Prices likely to remain Unchanged in March”- Odisha Miners

Iron ore prices in Odisha, India’s largest Iron ore producing state seem to remain unchanged in March, 2014, according to merchant miners.

SteelMint assessed that prices will remain unaltered for reasons that are mentioned.

1. Fewer permits for Outside State Sale

Trade sources say, with the state government’s rule of 50:50 that signifies sale of 50% of production within the state and rest 50% to outside state. Most of the miners have used their limit for sale of Iron ore to outside Odisha and within the state, however demand is not so strong. It will not make sense for miners to cut their prices now, when they are not able to sale their ore outside the state.

Sources also highlight that miners will think over revising prices in April, 2014 (next financial year i.e. FY15) when new permits will be issued.

2. Stable Demand from Sponge Iron Manufacturers

Sponge iron units which are located outside the state are struggling to source their raw material from Odisha; Sponge prices have been stable. Whereas, Sponge iron units located within the state are not interested to buy at these prices.

Trade sources highlight,Iron ore prices may come down owing to falling Iron pellet prices (substitute of Iron ore) in Odisha, which may put pressure on miners to cut their prices. However, chances are high that miners will review demand-supply situation in April and will take a call.”

Current Iron Ore Prices

Indian Iron Ore Prices (INR/MT) in Feb’14

Miners/E-auction

State

Grade/Fe

5-18 mm

Grade/Fe

10-30 mm

Grade/Fe

Fines

Rungta

Odisha

63

6,800

63

6,270

63

2,650

Essel

Odisha

63

6,775

63

6,025

63

2,675

Serajuddin

Odisha

63

5,620

63

2,620

Indrani Patnaik

Odisha

63

5,200

61

4,500

63

2,200

KJS Ahluwalia*

Odisha

63

5,450

61

4,300

63

2,350

KN Ram

Odisha

62

5,600

62

2,450

Singhbhum Minerals*

Jharkhand

60-62

4,900

60-62

4,500

RP Sao*

Odisha

     63/62

   1,900

Grade/Fe

6-40 mm

Grade/Fe

10-150 mm

Grade/Fe

Fines

NMDC

Chhattisgarh

65

4,500

64

3,950

64

2,910

Grade/Fe

10-40 mm

67

5,190

Odisha Prices loaded to wagons; including Royalty
* Prices are Ex-mines: including Royalty
NMDC Basic Prices including royalty 10%
Source: SteelMint

 

India: 1.5 MnT pa HR Coil Plant to be Commissioned in Maharashtra

A memorandum of understanding was signed between Government of Maharashtra and Shree Uttam Steel & Power for a 1.5 MnTpa HR Coil Plant and 40 MW Captive power plant at Maharashtra. The plant will be set up in sindhudurg district.

The project which is expected to be set up at INR 11, 156 crores will generate an employment of 2,500 people.

It is a great opportunity for us. The project could not have materialized without the help of Government of Maharashtra, who provide ambient environment for companies to operate in. The industrial climate of Maharashtra is very conducive for growth and Maharashtra has become one of the most progressive states in the country. The political leadership in Maharashtra has very ambitious plans for growth and the bureaucracy provides an efficient and diligent mechanism to implement such plans. The project will help in providing a great impetus in generating employment which will help in boosting the local economy as well. Anuj R Miglani, Director of Shree Uttam Steel & Power.

 

 

Sourced

 
Coal Production

US Coal Production slightly declined by 1.9% W-o-W

The World’s leading Coal producer, United States’ (US) have produced around 18.8 million metric short tons (mmst) of Coal during the week ended on 22 Feb, 2014 (16-22 Feb’14).

Its production decreased by 1.9% against previous week and 3.1% down from comparable weeks of 2013, reported by the US Government agency for the week ended 22 Feb, 2014.

US have produced around 141.8 mmst YTD Coal, including Coking, Non-coking & Anthracite. It’s year to date (YTD) Coal production dropped by 3% against YTD Coal production in 2013.

 

Coal production during the week ended on 22 Feb, 2014 from East of the Mississippi River totaled 8.1 mmst and from the West of the Mississippi River totaled 10.7 mmst.

Appalanchian, one of the major regions for Coal production has produced 5.5 mmst of Coal which rose to 2.4% from last week. West Virginia also produced 2.4% more Coal to 2.3 mmst than previous week’s 2.2 mmst Coal. Mines in Kentucky produced around 1.7 mmst than previous week’s 1.6 mmst.

The major Anthracite Coal source Pennsylvania has produced 1 mmst Coal including 43 mmst Anthracite.

 
Pellets

Indian Mines Ministry writes to Chidambaram to rollback Export Duty on Pellets

Indian Government imposed a duty of 5 per cent on exports of Iron Pellets on 27 Jan, 2014 owing to rising exports. Now Mines Minister writes to Finance Minister over taking back the duty.

Bhubaneswar: In a desperate attempt to revive the domestic Pellet industry, which is grappling for survival, the Minister of Mines Dinsha Patel, has written a letter to the Finance Minister P Chidambaram to roll back the 5% export duty imposed by the government. The letter also urges the Finance Ministry to consider the impact of its move on the sector, which is grappling with low domestic demand making exports crucial for survival of the industry.

In order to support the industry, various ministries like Commerce Ministry, Standing Committee of Parliament on Coal & Steel and various members of Parliament have come out in open to support the industry and have represented to the Steel Ministry & Finance Ministry to withdraw  5% export duty on Pellets. At stake, an investment of INR 35,000 Crore which has already been made by domestic & foreign players to build a capacity of 85 MnT pa, as well as 80,000 jobs both direct & indirect.

It is also surprising that such a severe step of imposing 5% export duty, which has a larger impact on the industry & economy, was taken without any consultation process.

The government and its agencies stand to lose substantial revenues by way of excise duty and other levies. Railways & ports will see huge revenue erosion by way of freight and handling charges. Other key stake holders are the banks & financial institutions, who have funded huge amounts for setting up these plants. This move by the government will be counterproductive for the GDP, as plants will shut down leading to revenue and jobs losses in the state. Frequent policy flip flops like re-introducing export duty which was abolished, will further discourage flow of FDI into the country and raise further questions about the growth of Indian Economy.

The industry had made such huge investments because of the encouragement provided by the Indian Government, so that low grade ore can be used to produce high value added products, which otherwise was an environmental hazard.

Given the grievous situation it is important that the Pellet industry survives and prospers in the larger interest of the country.

Letter attached.

Pellet Export Duty

 

India: MSTC’s Auction for Sale of Iron Ore

Metal Scrap Trade Corporation (MSTC) invites bid for sale of Iron ore from different Iron ore Mines/Stockyard at Karnataka.

Material will be available for sale on “As is Where is” basis.

The e-auction is for registered Steel plants, Pig iron plants, Pelletisation plant, Sponge iron plants and Beneficiation plants which have been wholly/partly dependent on Iron ore from Karnataka for their own use.

There are two auctions which are scheduled on the same day i.e. on 06 Mar, 2014 at 13.00 hrs and 15.00 hrs.

Auction 1: (Advance E-auction)

  • Iron ore fines: 232,000 MT
  • Iron ore lumps: 160,000 MT
  • Total quantity: 392,000 MT

Bid opening time: 13.00 hrs on 06 Mar, 2014

Auction 2:

  • Iron ore fines: 112,000 MT
  • Iron ore lumps: 152,000 MT
  • Total quantity: 264,000 MT

Bid opening time: 15.00 hrs on 06 Mar, 2014

Bid Submission Due Date: Before 10.00 hrs on 06 Mar, 2014

Royalty, Forest Development Tax, Sales tax, Cess and other statutory duties and levies etc. applicable at the time of supplies will be extra and payable by the successful bidder.
————————————————————————————————————————————————————–

Note: MSTC changed its auction date (Auction No- MSTC/BLR/MONITORING COMMITTEE /135/BANGALORE /13-14/14476[75822]) which was previously scheduled on 03 Mar, 2014. Now it is scheduled on 28 Feb, 2014 at 13.00 hrs with one of the already scheduled auction.