India?s first e-auction of iron ore mined by private players witnessed tight competition among iron and steel manufacturing firms. According to official sources, around 60 steel and sponge iron manufacturing units including steel giant JSW Steel took part in the e-auction conducted by the government-owned Metal Scrap Trading Corporation (MSTC) on Wednesday as directed by the Supreme Court.

Thanks to the intense bidding, iron ore fetched 25% more than the base price fixed by the auctioneer. The MSTC fixed a base price of R2,700 per tonne for iron ore fines and R 3,700 per tonne for lumps with fe content of 63% and above. The buyers have closed bids for around 4 lakh tonne of iron ore, sources added.

The MSTC should clear around 25 million tonne iron ore, which is already mined and lying in three districts of Bellary, Chitradurga and Tumkur.

The SC has ordered the MSTC to auction 1.5 million tonne every month. The MSTC would auction another 11-lakh tonne of iron ore in the next two weeks, an official attached to MSTC said requesting anonymity.

Talking to FE, an official with JSW Steel confirmed that the company participated in the bidding and bought some iron ore.

He said this would give temporary relief to the company, which has the country’s one of the largest steel manufacturing mill in Bellary with a capacity of 7-million tonnes per annum.

When the mining ban was imposed by the SC in Bellary at the end of July, the company had cut its production to upto 35%. After the SC allowing the state-owned National Mineral Development Corporation (NMDC) to sell 1-million tonne of iron ore every month, the company increased its plant operation capacity to 80%; a major chunk of iron sold by NMDC is bought by JSW Steel.

Now with the private iron ore available through e-auction, he said the company will try to operate with its full production capacity. He said the company?s Bellary plant requires around 35,000 tonne of iron ore for production per day.

R S Sharma, secretary general of Federation of Indian Mineral Industries (FIMI) welcomed the e-auction of iron ore. He said the auction would fetch higher price for the product.

The mines in Karnataka supply iron ore to several other large steel plants like Mukand, Tata Metalliks, Sathvahana Ispat, Kirloskar Ferrous, Kalyani Steel, Visveswaraya Iron and Steel and more than 70 sponge iron producing units and pellet producers like Bharat Mines and Minerals (BMM) and MSPL. All most all major companies have participated in the e-auction.

Generally the steel and sponge iron manufacturers like to buy lumps than fines. But MSTC has auctioned a mixed grade of iron ore to avoid stockpiling in the mining sites.

All the stocks put on auction (100 lots with 4,000 tonne per lot) have been successfully auctioned.