Indian Iron Ore Imports Fell 13% Y-o-Y in CY'17

Amid improved domestic iron ore availability Indian iron ore imports moved down by 13% in CY'17 to 5.5 MnT against 6.3 MnT last year. Pellet imports to India remained stable at 0.3 MnT in CY'17.

JSW Steel continues to remain largest iron ore importer in CY'17 -

India's major steel maker- JSW has imported 2.74 MnT iron ore from Brazil and Australia in CY'17 and turned out to be the largest importer. Followed by Kamachi Group remained the 2nd largest importer in CY'17 at 0.43 MnT followed by Kudremukh Iron Ore Company (0.42 MnT).

Reason for fall in Indian iron ore imports in CY'17-

1. Increased domestic iron ore availability in CY'17-: As Indian iron ore availability in Indian has increased in the year 2017 resulted, steelmakers to prefer domestic iron ore than imported iron ore. In the year CY'17 Indian iron ore production achieved remarkable landmark and has produced 201.8 MnT in CY'17 up by 9% against 184.5 MnT in CY'16.

2. Higher Global iron ore Prices - Yearly average global iron ore fines (Fe 62%) prices increased by 22% Y-o-Y to USD 71/MT, CFR China in CY'17 compared to USD 58/MT, CFR China in CY'16. High global iron ore prices and comparatively cheaper domestic material resulted in fall in import volumes.

What may happen in 2018?

As With few Odisha mines like Essel (Jilling) and RP Sao asked to resume operations, Odisha's iron ore production may augment as they have a total capacity of around 12 MnT pa.

Mines in Karnataka got the permission from Apex Court to raise iron ore excavation cap from 30 MnT to 35MnT. JSW Steel has already announced that it may start production from few of its mines that it won in 'C' category block auctions in FY'19, so the steelmaker may fulfill some of its requirement from its captive mines.

However west coast based steel plants may continue to import lumps from South Africa.

While looking overall scenario, it may possible that iron ore supply in the market increase and this may result in fall in import volumes.