NMDC trims price of lumps for 5th time since Oct

Iron ore mining firm NMDC reduced price of higher grade iron ore (lumps) for the fifth time since last October.

This time, the state-run miner cut the price of lumps (having iron content of 62 per cent or above) by about 7 per cent for April. However, the company has not changed the price of iron ore fines (lower grade) for the second month in succession.

Following the reduction in price, lumps would be available in the range between Rs 4,600 and Rs 4,700 per tonne, while fines (having iron content of less than 60 per cent) are currently being sold at Rs 2,610 per tonne.

Last month, the firm reduced the price of lumps by about 2.5 per cent. The reduction in the price of iron ore lumps would benefit domestic steel makers, those without captive iron ore mines, the most.

Owing to muted demand, the largest domestic producer of iron ore has either reduced the iron ore prices on a monthly basis or kept them unchanged since October.

Demand for steel, which requires iron ore for production, grew by just 4.4 per cent in 2012-13 owing to slowdown in construction, automobiles and fast moving consumer durables.

In terms of quantity, NMDC’s sales of iron ore had declined 17 per cent to 5.3 million tonne (mn t) in Q3, while the production was down 25 per cent at 5.4 mn t during the period.

The company has a total production capacity of 32 mn t per annum at its mines in Chhattisgarh and Karnataka.