JSW Steel lowers iron ore sourcing from merchant market by 18% in Oct'20
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Indian steel major - JSW Steel has sourced 1.19 mn t iron ore in Oct'20 from merchant market. The sourcing dropped by 18% as against 1.45 mn t in Sep'20. Company's captive iron ore production (Odisha and Karnataka) stood at 1.89 mn t & 1.73 mnt respectively in Oct & Sept'20. Thus with increasing captive production, the steel maker has lowered sourcing from merchant market.
Sourcing from Odisha dropped in Oct'20
The steelmaker procured 15,495 t of iron ore from Odisha based miners in Oct'20, down sharply as compared to 80,000 t in Sep'20. Sourcing from Odisha remained on the lower side amid material availability crises in Odisha which has led to continuous rise in prices by miners.
Sourcing from NMDC (C.G.) down 26% for the month
JSW Steel (Dolvi) sourcing from NMDC fell to 0.09 mn t in Oct'20 against 0.12 mn t in Sep' 20. The drop in sourcing is attributed to the rise in iron ore offers. The miner had increased prices by 6-7% for Oct'20. NMDC was heard to have been facing certain supply issues at its five mines in Chhattisgarh towards early October. Inclement weather conditions , persistent rainfall and fog - affected the NMDC's production volumes.
JSW iron ore purchases from Karnataka e-auction fell 14%
In the month of Oct'20, the company sourced around 1.08 mn t iron ore, down 14% against 1.25 mn t in Sep'20. Out of 1.08 mn t iron ore sourced by JSW in Oct'20, NMDC Kumarswamy mines supplied 0.35 mnt in Oct'20, contributing 32% of total sourcing as compared to 0.45 mn t in Sep'20. Vedanta remained the second-largest iron ore supplier to JSW Steel and supplies stood at 0.33 mn t in Oct'20 against 0.36 mn t in Sep'20.
JSW Steel Iron Ore Sourcing
Source: SteelMint Research
Quantity in t
Excludes captive iron ore sourcing
Provisional Data
Steel capacity utilization picked up in Oct'20
JSW Steel has reported an increase in capacity utilization to 89% in Oct '20, as per a recent release in BSE. In Q2 FY'21, the company reported average capacity utilization of 86% in Q2 FY'21. The crude steel production for the month of Oct'20 was at 1.338 mn t showing a growth of 4% over Sep'20 and 7% over Oct'19.
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.
