By Bizodisha Bureau, Bhubaneswar, October 5, 2017: The state-managed Odisha Mining Corporation (OMC) appears to have succeeded in drawing an encouraging response at its latest round of auctions of iron ore lumps on October 4 compared to the past auctions in recent years.

Around 80 per cent of 310,000 tonnes of lumps sourced from OMC’s Gandhamardhan, Daitari and Khandadhar mines was booked despite the state PSU increasing the floor prices upto Rs 200 per tonne.

OMC in this auction had offered only iron ore lumps and is expected to auction iron ore fines next month, sources said.

Interestingly, majority of steel industries which had booked iron lumps do not have captive mines. Jindal Steel & Power Ltd (JSPL), Visa Steel and Bhushan Steel are among the major buyers of iron ore from the state-run corporation. Even Tata Steel has a short-term linkage pact with OMC to buy iron ore.

Surprisingly, the OMC has shown interest in OMC’s auction because they are getting Rs 400-500 per ton of iron lumps less than those sold by the merchant mining companies, officials said.

The merchant miners have not passed on the benefit to end users notwithstanding slump in international prices. Rising demand for ore within the state and growing demand for high grade iron ore fines in the export markets, especially China, has pushed up prices of iron ore in the state.

This is despite slashing of prices of iron ore, lumps and fines recently by the Indian Government managed National Mineral Development Corporation (NMDC). It has fixed a price of Rs 2,300 per tonne for lumps and Rs 2,060 for fines as compared to the prevailing rates of Rs 2,400 and Rs 2,160 respectively.