Companies start buying iron ore on fear of supply disruptions

Steel manufacturers and other end user industries have accelerated iron ore buying as they dread marked disruption in supplies after the end of lease tenure of merchant mines by March 31, 2020.

Almost all leading integrated steel makers and secondary producers are buying iron ore to stock raw material and ensure uninterrupted production operations. The stocks are for three to six months.

Industry sources have estimated the accumulated ore at mine lease heads of merchant mines in Odisha at around 70 million tonnes (mt). However, a bulk of the inventory is made up by baser grade fines which hardly have any uptake in the domestic market. Steel manufacturers opt for lifting higher grade ore as inferior material escalates their costs of operations. Export markets too have been unkind to Odisha’s inferior iron ore as China’s steel mills driven by environment concerns have preferred to source superior ore or iron ore pellets.

Buying iron ore

You can have assistance on buying or selling iron ore with STSI Holding, your global steel partner.

Source: Business Stardard