Tue,July 26,2011
By Shubhashish, Business Standard
Mumbai: In the wake of the tussle between the Karnataka government and iron ore miners in Karnataka’s Bellary district, many steelmakers are facing shortage in supply of the raw material. JSW Steel, which operates an 11-million-tonne plant in the region, has secured iron ore supplies from the neighbouring Chitradurga, thereby reducing its dependence on Bellary.
“We are able to meet our requirement of iron ore from Chitradurga in Karnataka,” Vice-Chairman and Managing Director Sajjan Jindal said while addressing the 17th annual general meeting.
He said there were a lot of issues relating to iron ore miners in Bellary but declined to comment on the issue as the case was in the Supreme Court.
Vinod Nowal, director and CEO, JSW Steel, told Business Standard, “We were getting 50 per cent of our iron ore requirements from Bellary which is roughly around 20 million tonnes (mt). We are sourcing an additional 10 mt from Chitradurga.”
Nowal said of the 50 per cent iron ore that used to come from Bellary, the company is sourcing around 30 per cent from Chitradurga. The remaining 20 per cent is still being sourced from companies in Bellary with which JSW Steel has long-term contracts.
The company sources 20 per cent of iron ore from its captive resources. It gets another 30 per cent of the raw material through purchase agreements with state-run NMDC and Mysore Minerals Ltd. The remaining 50 per cent was being sourced from miners in the Bellary area.
“As on today, we are comfortable with our sourcing,” he said.
JSW Steel has also commissioned its benefication plant which has reduced its dependence on high grade of iron ore, thereby bringing the costs down. The company said that in 2009-10, 80 per cent of its total iron ore was of high grade, which has come down to just 30 per cent in 2010-11.
For the current financial year, the company will continue to source low-grade iron ore to meet its entire requirement, resulting in cost savings.
Talking about the production growth for the current year, Jindal said the company planned to produce nine million tonne of steel, which 40 per cent more from the previous year. The company has also commissioned a 3.2-mt blast furnace, taking its total installed capacity to 11 mt.
It said that the company has tied up for additional iron ore sources to feed the 3.2 million tonne steel melting capacity that has become operational in the first quarter of this year.
“We are able to meet our requirement of iron ore from Chitradurga in Karnataka,” Vice-Chairman and Managing Director Sajjan Jindal said while addressing the 17th annual general meeting.
He said there were a lot of issues relating to iron ore miners in Bellary but declined to comment on the issue as the case was in the Supreme Court.
Vinod Nowal, director and CEO, JSW Steel, told Business Standard, “We were getting 50 per cent of our iron ore requirements from Bellary which is roughly around 20 million tonnes (mt). We are sourcing an additional 10 mt from Chitradurga.”
Nowal said of the 50 per cent iron ore that used to come from Bellary, the company is sourcing around 30 per cent from Chitradurga. The remaining 20 per cent is still being sourced from companies in Bellary with which JSW Steel has long-term contracts.
The company sources 20 per cent of iron ore from its captive resources. It gets another 30 per cent of the raw material through purchase agreements with state-run NMDC and Mysore Minerals Ltd. The remaining 50 per cent was being sourced from miners in the Bellary area.
“As on today, we are comfortable with our sourcing,” he said.
JSW Steel has also commissioned its benefication plant which has reduced its dependence on high grade of iron ore, thereby bringing the costs down. The company said that in 2009-10, 80 per cent of its total iron ore was of high grade, which has come down to just 30 per cent in 2010-11.
For the current financial year, the company will continue to source low-grade iron ore to meet its entire requirement, resulting in cost savings.
Talking about the production growth for the current year, Jindal said the company planned to produce nine million tonne of steel, which 40 per cent more from the previous year. The company has also commissioned a 3.2-mt blast furnace, taking its total installed capacity to 11 mt.
It said that the company has tied up for additional iron ore sources to feed the 3.2 million tonne steel melting capacity that has become operational in the first quarter of this year.
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