Even as domestic iron ore prices decline, Indian steel companies are quoting premiums twice the base price to secure iron ore mines in ongoing auctions, signaling strong demand and strategic resource acquisition.
Despite the current downturn in domestic iron ore prices, India's steel manufacturers are demonstrating robust demand by bidding aggressively in the ongoing auctions for iron ore mines. Data from the Odisha government's second phase of auctions for 10 mines reveals an average premium of 107% over the reserve price, according to SteelMint. While this is lower than the 133% premium seen in the first phase, where 19 mines were available, it still indicates a strong appetite among steelmakers to secure their own sources of the crucial raw material. This strategic move allows companies to mitigate risks associated with fluctuating market prices and ensure a stable supply chain for their steel production.
