Iron ore price hike forces steel companies to pass on cost, says Sajjan Jindal
A hike in iron ore prices by state-run NMDC has left steel companies with no choice but to pass on the increased production cost to customers, JSW Steel Chairman Sajjan Jindal has said. “Recent increase in iron-ore price by state-owned NMDC & Orissa Pvt. miners is forcing steel companies to pass on increased cost of production,” Jindal said in a tweet.
On January 2, 2017, the country’s largest iron ore miner NMDC increased prices of higher grade iron (lumps) by Rs 500 to Rs 3,100 per tonne for the current month. The state-run firm also raised the prices for iron ore fines, which is inferior grade ore, by Rs 500 to Rs 2,760 per tonne for January.
The increased cost of other raw materials like coal, refractory, electrodes is further fueling this and leaving no other option, Jindal said. The price hike in January is the third-straight rise since November 2017 when NMDC had fixed the rates of lump ore at Rs 2,300 a tonne and that of fines at Rs 2,060 a tonne. In December, 2017, it rose the price of lump ore by Rs 300 a tonne to Rs 2,600 and fines by 200 to Rs 2,260 a tonne.