The company is likely to procure around 47-50 rakes of iron ore from NMDC Bailadila mines in month of Sept’15. Two bulk shipments of pellets are expected to reach Hazira Port by the end of this week.
Essar Steel is procuring iron ore at rapid pace compare to previous month. The company is one of the leading steel producers in India and has a fully integrated steel plant at Hazira (Gujarat) of 10 MnT pa steel making capacity.
The company generally procures iron ore (Fe 64%) from NMDC Bailadila Mines to feed its pelletization plant at Vizag through pipeline. But, due to technical fault in pipeline, the company is currently transporting iron ore through railways.
The pipeline was constructed by Essar Steel to transport iron ore from Bailadila iron ore mines to its pelletisation plant in Vishakhapatnam. The 267 km pipeline passes through the states of Chhattisgarh, Odisha and Andhra Pradesh.
As per rake movement data till 22 Sept’15, the company procured 39 rakes i.e.148,200 MT iron ore from NMDC. On an average, Essar Steel ferries about 200,000 – 215,000 MT iron ore in slurry form to its 8 MnT pa plant at Vishakhatpatnam.
Purchase of iron ore by Essar Steel had slowed down during past couple of months, but with recent developments, it is likely to be restored quickly.
Essar Steel’s two bulk coastal shipments
In Sept’15, Essar Steel purchased two bulk vessels of pellet from KIOCL.
A vessel named “Aurolio 2” carrying 50,000 MT pellets moved from Mangalore Port on 23 Sept’15 and is expected to reach Hazira Port by the end of this week. The deal had been tentatively concluded at INR 4,500/MT FoB.
Another vessel named “Bulk Paraiso” carrying 52,500 MT pellets is at anchorage and is expected to arrive at Hazira Port. The deal had been tentatively concluded at INR 4,500/MT FoB.
Essar Steel has raised pellet purchases from coastal movement to feed its integrated steel plant at Hazira (Gujarat). The plant has annual production capacity of 10 MnT.
Sources say that Essar Steel has increased production from Hazira steel plant due to improved domestic demand after imposition of 20% safeguard duty.
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