India: JSW Steel's iron ore sourcing remains largely stable in Aug'20

JSW Steel - India's one of the largest private steelmaker total iron ore sourcing recorded at 1.89 mn t in Aug'20. The sourcing remained largely stable as against 1.95 mn t in July'20. On a yearly basis, sourcing picked up 12% against 1.69 mn t in Aug'19.

Sourcing from Odisha dropped 48% in Aug'20

The steelmaker procured 0.06 mn t of iron ore from Odisha based miners in Aug'20, down 48% as compared to 0.12 mn t in July'20. Sourcing from Odisha remained on the lower side amid logistic issues, and material availability crises in Odisha.

Sourcing from NMDC (C.G.) fell amid monsoons

JSW Steel (Dolvi) sourcing from NMDC fell to 0.14 mn t in Aug'20 against 0.15 mn t in July' 20. Also, NMDC iron ore production & dispatches were hit by monsoon for the month. NMDC's iron ore production from Chhattisgarh mines in Aug'20 recorded at 1.01 mn t as against 1.56 mn t in July'20.

JSW iron ore purchases from Karnataka e-auction remain unchanged

In the month of Aug'20 JSW sourced around 1.68 mn t iron ore, almost similar to last month's sourcing. Out of 1.68 mn t iron ore sourced by JSW, Mineral enterprises Ltd. remained the largest supplier at 0.46 mn t. Vedanta being the second-largest iron ore supplier to JSW Steel but supply decreased sharply by 42% to 0.29 mn t in Aug'20 against 0.5 mn t in Jul'20.

Other suppliers to JSW Steel were Karnataka State Minerals Corporation Ltd at 0.16 mn t, Ramanadurga Iron Ore Mine at 0.1 mn t, and others 0.42 mn t

JSW Steel imports recorded nil in Aug'20

JSW Steel imports witnessed nil for the month owing to high global iron ore fines (Fe 62%) prices. The average global iron ore prices in Aug'20 witnessed rise to $122/t, CFR China as against average price of about $107/t, CFR China in July'20.

JSW Steel Iron Ore Sourcing

Source: SteelMint,
Quantity in t
Excludes captive iron ore sourcing from Karnataka mines
Provisional Data

In Odisha iron ore and manganese mine block auction 2020, JSW Steel has bagged four iron ore mines, Nuagaon at 95.20%, Narayanposhi at 98.55%, Ganua block at 132%, and Jajang at 110% premium.

JSW Steel has commenced dispatch of iron ore from Odisha, following start of operations from all of its four newly-acquired mines.

JSW Steel in its recent press release mentioned that its average capacity utilization went up to 88% in Aug'20 from 83% in Jul '20 and 76% in Jun '20. Crude steel output gained by 6% to 1.32 mn t in Aug '20 against 1.25 mnt in July'20 .

Future plans: The Company expects to ramp up iron ore production from its recently won mines in Odisha and existing captive Karnataka mines. Adding up output from recently won mines in Odisha, the company plans to have captive iron ore production around 21 mn t in FY21.