One of the largest steelmakers in India, JSW Steel is likely to source 50% Iron ore through captive mines.
JSW Steel is planning to source at least 50% of its Iron ore through captive mines, stated by Mr. Vinod Nowal, Deputy Managing Director of JSW.
At present, the company is purchasing the key raw material i.e. Iron ore from domestic market and some quantity is importing from other states because it doesn’t have its own Iron ore mines to meet the requirement of its plants in Karnataka, Maharashtra & Tamil Nadu.
Mr. Nowal said to media, “We are more interested in Karnataka mines owing to cost advantage. We are targeting to have at least 50-60% captive source.”
After the Supreme Court banned mining in Karnataka, the company struggled with scarcity of Iron ore. JSW Steel stared to import the key raw material from South Africa & Canada through sea route despite its plant in Karnataka being landlocked. At an average, the company needs around 22.5 MnT of Iron ore annually.
JSW Steel will bid for existing but currently closed mines at Karnataka in the impending auction of Category C mines. The company anticipates auctioning Category C mines by end of this fiscal year. It is hopeful that the government will boost up the process of granting fresh mining leases in Karnataka.
“Almost 15 applications for fresh mines are present there. However, it depends on when the government will grant and when it will come to us. If they initiate action in the next 6-month, it will take at least 2 years to start the mines,” he further added.
No improvement has been made yet with the Apex Court putting a cap of 30 MnT on Iron ore production every year. However, these mines are taking too long time to obtain clearances that resulted in dearth of Iron ore. Currently, fresh mine applications from several companies are pending with the state government. Along with JSW Steel, Kalyani Steel is one of the companies waiting for fresh mines.
Kalyani Steel’s Managing Director, Mr. RK Goyal urged in the news that the new government has not yet moved on for the fresh mining leases.