India: NMDC's iron ore movement to Chhattisgarh falls 30% on-month in June

Government-owned NMDC recorded iron ore rake movements from Chhattisgarh at 209 in June, 2022, lower by 30% against 299 in May, according to data maintained with SteelMint. The figure include movements within Chhattisgarh and to other state-based units but exclude supply to AM/NS India through slurry pipeline. Notably, a rake carries 3,850 tonnes (t) of iron ore.

RINL largest buyer: Rashtriya Ispat Nigam Limited (RINL) remained the largest buyer of NMDC's iron ore from Chhattisgarh in June. RINL's iron ore sourcing inched down by 4% to 108 rakes in June as against 112 in May. RINL had seen production dropping with one of its three blast furnaces out of operation for quite some time.

JSW Steel recorded a 48% decrease in receipt of iron ore rakes from NMDC Chhattisgarh at 58 in June as against 111 in May.

Southern India-based pellet-maker KIOCL recorded iron ore sourcing at 4 rakes in June, a sharp decrease compared with 15 in May. KIOCL has undertaken temporary shutdown of its pellet plant at Mangalore due to the imposition of a 45% duty on pellet exports by the Government of India vide its notification dated 21 May'22.

NMDC's total iron ore rake movements to plants-based outside Chhattisgarh were recorded at 189 last month compared to 272 in May.

Chhattisgarh-based units sourcing from NMDC drops further: NMDC's iron ore rake movements to Chhattisgarh-based units were recorded at 20 in June compared to 27 in the previous month, as per data maintained with SteelMint. The figures are sharply lower compared to the monthly average of 75-80 rakes.

The company had reduced its prices on 5 June, 2022, it slashed prices of lump ore by up to INR 1,320/t and fines by INR 1,100/t. However, Chhattisgarh-based units remained active in procuring cost-competitive pellets and iron ore from Maharashtra. With the steep export duty being imposed, merchant pellet exporters have diverted supplies to the domestic market, which is weighing on prices.

Exports nil: NMDC's long-term iron ore export contracts with Japanese steel mills (JSMs) and South Korea's POSCO were scrapped, as the key sop of a reduced 10% export duty was removed.

NMDC's (Chhattisgarh) iron ore rake movement: May'22 vs Jun'22

Figs. exclude ArcelorMittal Nippon Steel India Limited's movement through slurry pipeline.
Each rake carries approximately 3,850 t of iron ore
Source: SteelMint Research, Railways

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