Companies

NMDC expects e-auction of iron ore to start soon

Our Bureau New Delhi | Updated on March 12, 2018 Published on September 28, 2011

Mr Rana Som, CMD, NMDC Ltd

Looking to sell about 2 lakh tonnes this week





NMDC expects e-auction of iron ore produced from its mines in Karnataka to begin later this week, the Chairman, Mr Rana Som, said Wednesday. This will hit customers who source iron ore through long-term contracts.

These include JSW Steel, Tata Metaliks, Ispat Industries, Kudremukh Iron Ore Company Ltd, Southern Iron and Steel Company (SISCOL) and Lanco Industries. “The long-term contracts with these customers stands superseded through the order of Supreme Court,” Mr Som said.

Apex court fiat

NMDC's move is following the Supreme Court direction last week that all sales to long-term or spot customers will have to be done through e-auction in Karnataka. NMDC is looking to sell about 2 lakh tonnes through the e-auction route this week, Mr Som said.

He was speaking to reporters after the company's quarterly review by the Steel Minister, Mr Beni Prasad Verma.

Though the e-auction process helps NMDC fetch better rates, it also poses a concern due to slower evacuation and resultant stocks pile up. “It does not allow us to evacuate as fast as we can do under long-term contracts,” Mr Som said adding that it was too early to decide on curtailing the output.

“We have been producing almost 33,000 tonnes a day for about two weeks. However, in the past four to five days, the production has been less at about 26,000 tonnes due to the stock pile up as e-auctions haven't started till date,” Mr Som said.

NMDC is the only company allowed by apex court to operate two mines in Karnataka, following the ban on mining in Bellary region on environmental grounds. The company has been asked to produce about a million tonnes a month by the court to meet the requirement of local steel mills.

Published on September 28, 2011
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