India: NMDC's iron ore rake movements from Chhattisgarh drop 27% m-o-m in July'24

In July 2024, the National Mineral Development Corporation (NMDC), India's largest iron ore miner, dispatched 348 rakes from its Chhattisgarh mines, equivalent to 1.34 million tonnes (mnt) of iron ore. This was a 27% decline compared to 477 rakes (1.84 mnt) recorded in June, as per BigMint data.

These rake movements encompass movements within Chhattisgarh and to other state-based units but exclude supply to AM/NS India through slurry pipeline. Each rake carries around 3,850 t of iron ore.

In July, heavy rainfall and flood-like conditions in southern Chhattisgarh disrupted iron ore supplies, causing difficulties in loading rakes. Most of the mills had completed their restocking before the monsoon to maintain uninterrupted operations despite the seasonal challenges.

Sourcing by non-state units down

JSW Steel, Dolvi emerged as the top buyer, receiving 118 iron ore rakes in July, a decrease of 4% compared with 124 rakes in June.

Rashtriya Ispat Nigam Ltd's (RINL) iron ore rake movements were recorded at 73 in July, a decline of 37% m-o-m as against 116 rakes in June.

JSPL recorded an decrease of 20% in its iron ore rake bookings from NMDC at 24 in July compared to 30 rakes in June.

AM/NS sourced 18 rakes in July, a decline of 47% against 34 rakes in June.

KIOCL, PSU pellet-maker, has suspended its operations from 10 June. The resumption notice is yet to come. However, it sourced seven rakes in July from NMDC against just two in June.

Overall, NMDC's total iron ore rake movements to plants outside Chhattisgarh stood at 273 in July, a decline of around 22% against 348 in June.

Sourcing by Chhattisgarh-based units drop m-o-m: Number of rakes of NMDC carrying iron ore to Chhattisgarh-based units was 75 (0.28 mnt) in July, down sharply from 129 rakes (0.49 mnt) in June. In addition, NMDC's supplies to its Nagarnar plant decreased in July to 33 rakes compared to 65 in June.

Notably, NMDC has yet to declare prices for August delivery. Meanwhile, it has decreased prices of iron ore fines and lump by INR 500/t ($6/t) for July deliveries. Iron ore lump prices were (6-40mm, Fe 65.5%) at INR 5,950/t ($/t) and iron ore fines (-10mm, Fe64%) at INR 5,110/t ($67/t) from the company's Chhattisgarh mines. Prices include royalty, DMF and NMET charges.

NMDC's iron ore production in July was recorded at 2.17 mnt, a decrease of 36% m-o-m as against 3.37 mnt in June. Volumes fell to a nearly two-year low amid heavy rains. Iron ore sales dropped 18% m-o-m to 3.06 mnt in July as against 3.73 mnt in June. Production volumes decreased 14% y-o-y to 11.36 mnt in April-July'24 against 13.15 mnt in the same period of last year.