Essar Steel Raises Iron Ore Sourcing, Pellet Coastal Movement Doubled in Jul’16

The steel maker aims to ramp up its crude steel production by 58% Y-o-Y from 3.8 MnT in FY16 to 6 MnT in FY17. In line with its expected increase in crude steel production, its iron ore sourcing and pellet production have also witnessed significant increase.

Essar Steel – an integrated steelmaker with steel making capacity of 10 MnT pa has increased its iron ore sourcing by 5% M-o-M from 0.84 MnT in Jun’16 to 0.88 MnT in Jul’16.

Essar Steel is presently sourcing iron ore from Odisha merchant miners, NMDC (C.G.) and through imports. Out of 0.88 MnT iron ore procured in Jul’16, share of domestic sources was 92% (0.81 MnT) while remaining share of 0.07 MnT was of imports.

Sourcing from NMDC (C.G.) down in Jul’16 – As per data maintained with SteelMint, Essar Steel procured 0.4 MnT iron ore from NMDC’s (C.G.) in Jul’16 compared to 0.55 MnT in Jun’16. Out of this, it sourced sourced 5 rakes via railway movement and remaining via slurry pipeline.

Single iron ore shipment observed in July- Unlike Jun’16 when Essar Steel had imported 72,000 MT pellets from Bahrain, Jul’16 did not notice any pellet import shipment. Rather Essar Steel imported a vessel of 74,150 MT iron ore from Brazil in Jul’16.

Iron ore sourcing from Odisha doubled in Jul’16 – Essar Steel procured 0.22 MnT iron ore from Odisha based merchant miners which increased in Jul’16 and stood at 0.4 MnT.

Essar Steel’s iron ore & pellet sourcing : Jun’16 vs Jul’16

Qty in MT
Provisional data
Source: SteelMint Research, Customs, Odisha govt.

Essar Steel’s coastal pellet movement rises sharply in Jul’16 – As per customs data maintained with SteelMint, in the month of Jun’16, Essar Steel moved nearly 0.48 MnT pellets from its Vizag and Paradip plants for its Hazira facility. However in the month of Jul’16, the steel giant moved 0.83 MnT pellets from its pellet plants for its Hazira based steel plant. Hence it is apparent that the steel maker has raised its pellet production to fulfill its set target following which coastal pellet movement has also dobled on monthly premises.