Odisha's merchant iron ore dispatches down 25% m-o-m in Aug'20

Odisha- India's largest iron ore producing state recorded total merchant iron ore dispatches at 3.40 mn t in Aug'20, down 25% as against 4.55 mn t in July'20. The figures exclude movement for export and dispatches of miners- SAIL, JSW & Tata Steel.

Key highlights

• Rungta Mines recorded the highest dispatches of iron ore at 0.66 mn t in Aug'20, down 43% as against 1.15 mn t in July'20.
  
  
• OMC, state-owned miner, recorded sharp decline in dispatches to 0.43 mn t for the month as against 0.78 mn t in the last month (July'20). However with resumption in production from its Gandhamardhan B block and commencement of operations at Tiring Pahar, dispatch volumes are likely to pick up in the coming months.
  
  
• Essel mining dispatches recorded at 0.43 mnt , up against 0.22 mn t in July'20.
  
  
• Sarda mines dispatched 0.28 mn t for the month. In a recent update received, Sarda Mines will have to stop operation immediately as per orders of the Ministry of Environment and Forest and Climate Change that finds its environment clearance invalid. The MoEF&CC on Monday (21st Sep) wrote to its counterpart in Odisha asking it to stop work at the Thakurani iron ore mines with immediate effect. The miner had resumed operations in Jan'20 after it deposited INR 933 crore as compensation for mining over and above various permitted caps.
  
  
• Serajuddin mines dispatches recorded 59% fall on a monthly basis to 0.20 mn t in Aug'20 as compared to 0.48 mn t in July'20.
  
  

Odisha Iron ore Dispatches in Aug'20 & July'20

Quantity in mn t
Excluding movement for export & movement of SAIL,JSW and Tata Steel
Provisional Data
Source: Govt. of Odisha

Outlook - There is a persistent supply imbalance in Odisha due to 14 of the 19 newly auctioned mines failing to start operations. The supply squeeze in Odisha, which contributes over 50% of the country's annual iron ore output, is evident. Total production from 5 auctioned mines (4 mines of JSW and 1 mine of AMNS) was at 1.5 mn t during Apr-Jul'20 against target production of 17.4 mn t pa. SteelMint has learned that Serajjudin which retained the 15.5 mnt capacity Balda iron ore mine and Debabrata Behera who bagged the Silijora-Kalimati iron ore and manganese mine have assured the state that they would be starting work soon. Resumption of mining operations may ease out tight availability to some extent.