NMDC is in the process of hiring an international consultant to recommend a new iron ore pricing mechanism. It will study the different models followed in other countries.
The iron ore miner has been facing flak from steelmakers after it increased its ore prices for the current quarter, despite international prices falling. The firm, which has a quarterly pricing structure, bases its price on the prevailing domestic demand-supply position and the prices in the previous quarter. It had raised prices by eight per cent to 13 per cent for the July-September quarter.
“We have invited application from global consultants. We hope to finalise the consultant by next month,” C.S. Verma, CMD in-charge, said.
As for the price revision for the October-December quarter, he said the company’s board meeting scheduled on October 1 would take a call on the prices for the coming quarter.
Price cut
Asked whether there was a possibility of a price cut, he said, “internationally, (iron ore) prices are under pressure and is expected to remain so for the next six months. And India cannot be insulated.”
Iron ore prices have fallen from an average of about $200 a tonne a year ago to about $150 six months ago and below $100 a tonne at present. NMDC produces about 32 million tonnes of iron ore and supplies to steelmakers, including Jindal and Essar.