Riding on the rally in international iron ore prices, private sector miners in the eastern Indian state of Odisha have hiked domestic prices of the raw material to INR 5,150/mt ($81/mt) for high grade lumps with Fe content 63 percent and higher, close to a 50 percent increase compared to the average domestic price prevailing in October-November 2017, two Odisha-based miners said on Thursday, January 4.
The miners said that the price hike is in response to the sharp rise in the international price of iron ore and the lead set by government-owned NMDC Limited, the largest domestic supplier, which has increased its domestic sale price by about 35 percent since October-November 2017.
Domestic prices of high grade iron ore lumps will touch levels of INR 6,500/mt ($102/mt), over the next two months if international prices of the raw material are sustained above the $70/mt mark, the miners said.
The miners along with two other traders said that high domestic prices for iron ore will be supported by the fall in supplies of the raw material from Odisha. They forecast that iron ore supplies from the eastern state will fall by at least 20 million mt over the next few months since seven large local mines will be forced to close down as they failed to pay the Supreme Court-mandated penalty for mining law violations by the deadline of December 31, 2017.