 "Goa to auction 4.7 mt of iron ore")
The government of Goa has offered the highest ever quantity of 4.7 million tonnes of low grade iron ore for sale through auction.
Of around 15 million tonnes of iron ore inventories before suspension of mining in the state two years ago, Goa's Directorate of Mines & Geology has sold 5 million tonnes in seven auctions since February 2014.
Bidders placed bids for 55,450 tonnes of the 1.01 million tonnes of ore offered in an auction on August 4 as interest from user industries like sponge iron manufacturers, mini-steel mills and ore exporters waned.
Iron ore price have risen 14 per cent to trade at $51 a tonne. The Directorate of Mines & Geology anticipates further increases in iron ore prices and has offered the highest quantity for sale.
"Iron ore prices are softening. There is no demand from local or Chinese steel mills. Around half the quantity auctioned remains stocked at the mine head. There is a likelihood of weak buying interest in this auction too," said Haresh Melwani, chief executive officer, HL Nathurmal & Co, a Goa-based iron ore miner and exporter.
Since demand for low grade iron ore weakened in China, Goa's miners are facing a problem in unloading stocks. A duty of 15 per cent on low grade ore makes Indian exports uncompetitive in Chinese markets. China used to import around 90 per cent Goa's irone ore production before the ban on mining.
A number of investors, however, have set up forward integration plants to produce sponge and pig iron, raw materials for making steel.
According to a functionary of the Goa Mineral Ore Exporters' Association, some of the ore bought by traders in the auctions is yet to be lifted from mines.
Mining companies like Fomento, Chowgules, VM Salgaocar and Bandekars have obtained or are in the process of obtaining clearances to resume mining. They are waiting for the monsoon to ease before they begin.
Transportation of iron ore halts in Goa due to the monsoon. Even after the auctions, clearing mine pits appears impossible until October.
Of around 15 million tonnes of iron ore inventories before suspension of mining in the state two years ago, Goa's Directorate of Mines & Geology has sold 5 million tonnes in seven auctions since February 2014.
Bidders placed bids for 55,450 tonnes of the 1.01 million tonnes of ore offered in an auction on August 4 as interest from user industries like sponge iron manufacturers, mini-steel mills and ore exporters waned.
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"The government wants to clear mine sites ahead of re-commencement of mining in October. Also the recovery in iron ore prices in global markets prompted the government to announce fresh auctions," said an official of Goa's Directorate of Mines & Geology.
Iron ore price have risen 14 per cent to trade at $51 a tonne. The Directorate of Mines & Geology anticipates further increases in iron ore prices and has offered the highest quantity for sale.
"Iron ore prices are softening. There is no demand from local or Chinese steel mills. Around half the quantity auctioned remains stocked at the mine head. There is a likelihood of weak buying interest in this auction too," said Haresh Melwani, chief executive officer, HL Nathurmal & Co, a Goa-based iron ore miner and exporter.
Since demand for low grade iron ore weakened in China, Goa's miners are facing a problem in unloading stocks. A duty of 15 per cent on low grade ore makes Indian exports uncompetitive in Chinese markets. China used to import around 90 per cent Goa's irone ore production before the ban on mining.
A number of investors, however, have set up forward integration plants to produce sponge and pig iron, raw materials for making steel.
According to a functionary of the Goa Mineral Ore Exporters' Association, some of the ore bought by traders in the auctions is yet to be lifted from mines.
Mining companies like Fomento, Chowgules, VM Salgaocar and Bandekars have obtained or are in the process of obtaining clearances to resume mining. They are waiting for the monsoon to ease before they begin.
Transportation of iron ore halts in Goa due to the monsoon. Even after the auctions, clearing mine pits appears impossible until October.