JSW Steel to ramp up production for 51% of iron ore need

JSW Steel targets to meet 51 per cent of its iron ore requirement through production from captive mines by March 2021. At present, 27 per cent of the ore supply happens from captive sources.By end of this financial year, about 85 per cent of the iron ore requirement for the Dolvi plant will be met through supply from captive mines. Salem plant will get entire requirement of ore, while the Vijayanagar plant will get much lesser 35 per cent of its requirement from our mines. Overall supply will be 51 per cent of the requirement.

JSW Steel acquired four iron ore mines — Jajang, Nuagaon, Ganua and Narayanposhi — in Odisha in February. These mines have 1,131 million tonne reserves, which constitute about 60 per cent of the whole reserves of iron ore in Odisha. Once these four blocks function with full capacity, it is expected to produce around 36 M MT per annum and meet about 70 per cent of its requirements. The steelmaker has three more mines in Karnataka where availability is going up from 4 M MT to 7 M MT.

Indian Steel Ministry targets to double rural steel demand

The government has a fixed objective of increasing rural consumption of steel from the current 19.6 kg/per capita to 38 kg by 2030-31. While the national steel consumption average stands at 74.7 kg, the government is aiming to increase rural per capita consumption to 36 mn t from the current 18-odd mn t/per annum. It deserves mention that demand emanating from rural India provided the silver lining during the COVID-19 lockdown when export demand coupled with rural recovery supported steel sales. A Ministry of Steel webinar held on 20thOct’20, with CII on board, deliberated on topics of pressing importance.

Tata Steel, JSW Steel to clock record profits as steel prices shoot up.

Big steelmakers such as Tata Steel, JSW Steel and ArcelorMittal Nippon will reap high profits as the steel prices rise above the pre-COVID levels. Prices have been shooting up for the last four months in line with the rise in iron ore prices. Big steelmakers with captive iron ore mines are largely unaffected by the rise in raw material cost, but are getting the benefits of the resultant rise in steel prices.  

The second quarter is going to be an unexpected bumper for big steelmakers as steel prices are consistently moving up due to the pent-up demand in the domestic market. The margins are high in the domestic market, unlike the export. If first quarter survival was because of the export, the second quarter will be the resurgence story of the domestic market.

The high flat steel consumption of automobile and consumer durables industries has helped in the rise in domestic demand. However, the long products sale is yet to come back to normalcy because of the continuing gloom in the construction and infrastructure segments. The steelmakers expect that the construction and infrastructure segments will bounce back in the third quarter as road, bridges and metro works restart in most of the states.

Tata Steel traditionally procures entire iron ore from its mines. JSW Steel got big captive mines in Odisha recently and plans to scale up production to around 80 per cent of their requirement. ArcelorMittal had captive mines around the world and can route it to their unit in India.