Essar Steel: Iron Ore & Pellet Sourcing Up 6% in FY'18
...
Essar Steel - an integrated steelmaker with steel making capacity of 10 MnT p.a. recorded slight increase in its iron ore & pellet sourcing in FY'18. Its sourcing stood at 11.72 MnT as against 11.01 MnT in FY'17.
The company's procurement of iron ore & pellet increased sharply 24% M-o-M to 1.44 MnT in Mar'18 as against 1.16 MnT in Feb'18.
The Y-o-Y iron ore & pellet sourcing recorded a significant rise of 67% in Mar'18 as against 0.86 MnT in Mar'17.
Iron ore procurement from NMDC (C.G.) up 10% Y-o-Y in FY'18 -
In FY'18, Essar Steel sourced a total of 7.41 MnT iron ore from NMDC Bailadila mines, up 10% Y-o-Y as against 6.76 MnT in FY'17.
Essar Steel procured 0.92 MnT of iron ore in Mar'18 from NMDC's Bailadila mines in Chhattisgarh via slurry pipeline, which stood 53% up as against 0.60 MnT in Feb'18. However, it witnessed increase of 22% Y-o-Y in Mar'18 compared to 0.75 MnT in Mar'17.
Sourcing from Odisha merchant mines almost stable in FY'18 -
Essar Steel in FY'18 recorded 3.45 MnT iron ore being sourced from Odisha merchant mines, down marginally against 3.59 MnT in FY'17. The company sourced 2 MnT iron ore from KJS Ahluwalia mines, up 57%. However procurement from Serajuddin Mines fell from 1.88 MnT in FY17 to 0.99 MnT in FY18.
The company sourced 0.44 MnT iron ore from Odisha's merchant mines up 16% M-o-M in Mar'18 compared to 0.38 MnT in Feb'18. Out of the total iron ore sourced from Odisha in Mar'18, largest share was contributed by KJS Ahluwalia at 0.20 MnT(down 11% on monthly basis), followed by Serajuddin at 0.16 MnT and Rungta Mines at 0.05 MnT( down 50% M-o-M).
Essar Steel recorded sourcing from Serajuddin mines at 0.16 MnT after recording nil procurement since last two months. The operations at mine were stopped from 1st Jan'18 to 23rd Feb'18, owing to illegal mining activities which resulted in nil production at the mines.
Essar Steel's imports recorded 29% increase in FY'18 -
Essar Steel yearly imports recorded at 0.86 MnT in FY'18 up sharply by 29% against 0.66 MnT in FY'17. Out of the total imports, 0.39 MnT stood iron ore imported from Australia and Brazil, while remaining 0.47 MnT were pellet imported from Bahrain.
Essar Steel imports witnessed at 0.08 MnT in Mar'18, down 55% against Feb '18 imports at 0.18 MnT. The complete import material comprised of Pellets imported from Bahrain.
Essar Steel's iron ore & pellet Sourcing FY'18 v/s FY'17
| Seller | Mar'18 | Feb'18 | M-o-M (%) | FY'18 | FY'17 | Y-o-Y (%) |
| NMDC | 0.92 | 0.60 | 53% | 7.41 | 6.76 | 10% |
| KJS Ahluwalia | 0.20 | 0.23 | -11% | 2.01 | 1.28 | 58% |
| Serajuddin | 0.16 | - | 100% | 0.99 | 1.88 | -47% |
| Import | 0.08 | 0.18 | -55% | 0.86 | 0.66 | 29% |
| Indrani Patnaik | 0.05 | 0.10 | -50% | - | - | 0% |
| Rungta Mines | 0.02 | 0.03 | -28% | 0.19 | 0.04 | 371% |
| Kaypee Enterprises | 0.01 | 0.02 | -46% | 0.18 | 0.32 | -42% |
| MG Mohanty | 0.00 | 0.00 | - | 0.01 | - | 100% |
| Mid East Integrated Steel | - | - | 0% | 0.06 | 0.07 | -8% |
| Grand Total | 1.44 | 1.16 | 24% | 11.72 | 11.01 | 6% |
Qty in MnT
Provisional data
Source: SteelMint Research, Customs, Odisha govt.
Debt laden Essar Steel is currently undergoing insolvency resolution process. Subsequently, three bidders mentioned below have put in their bids to take over bankrupt Essar Steel in the second round of bidding held on 2 Apr'18 which includes-- ArcelorMittal along with Nippon Steel & Sumitomo Metal Corporation; Mining giant Vedanta group, a consortium of Russia's VTB Capital-backed NuMetal along with JSW Steel.
The second round was open only to firms that had submitted EoIs (Expression of Interest) in the first round, blocking new entrants from submitting resolution plans. Vedanta had submitted EoI earlier while JSW Steel which could not participate in the bidding process on a standalone basis (since it had not submitted an EoI), decided to team up with Numetal to submit a resolution plan.
