Pellet export from Essar Steel increase significantly from 0.05 MnT in Q1 FY17 to 0.43 MnT in Q2 FY17.
Essar Steel – an integrated steelmaker with steel making capacity of 10 MnT pa has increased its iron ore sourcing by 14% Q-o-Q in Q2 FY17. The company sourced 2.94 MnT iron ore in Q2 FY17 compared to 2.59 MnT in Q1 FY17.
On monthly premises, the steel maker has raised its iron ore procurement by 15% from 0.96 MnT in Aug’16 to 1.1 MnT in Sept’16. So far in this fiscal (till Sept’16), the steel maker has sourced 5.53 MnT iron ore.
Sourcing from domestic market up, imports down in Q2 FY17
Compared to Q1 FY17, Essar Steel focused more on domestic sourcing last quarter. It procured nearly 2.8 MnT iron ore from domestic market in Q2 FY17 against 2.3 MnT in previous quarter. Domestic iron ore prices remained mostly stable in last quarter. Odisha iron ore prices also witnessed stability till mid Sept’16 and quantity discounts on bulk bookings kept buyers attractive.
Out of 2.8 MnT iron ore sourced from domestic market last quarter, 1.5 MnT was sourced from NMDC Chhattisgarh (down by 7% Q-o-Q) and remaining 1.28 MnT was procured from Odisha based merchant miners (up by 94% Q-o-Q). Amongst Odisha miners, considerable quantity was procured from Serajuddin Mines, KJS Ahluwalia and Indrani Patnaik.
To the contrary, global iron ore prices remained strong in Q2 FY17. Owing to this, iron ore imports by the steel maker halved from 0.3 MnT in Q1 FY17 to 0.15 MnT in Q2 FY17.
Essar Steel’s iron ore & pellet sourcing – Q2 Vs Q1 FY17
|
Particulars |
Apr’16 | May’16 | Jun’16 | Jul’16 | Aug’16 | Sept’16 |
Total |
| 1. Import | 175,000 | 65,500 | 72,000 | 74,150 | – | 75,600 | 462,250 |
| 2. Domestic | 740,845 | 764,815 | 768,503 | 806,571 | 960,035 | 1,025,760 | 5,066,529 |
| NMDC (C.G.) | 519,850 | 549,000 | 550,000 | 404,000 | 534,000 | 570,000 | 3,126,850 |
| Indrani Patnaik | 10,724 | 83,726 | 109,875 | 142,639 | 81,282 | 33,086 | 461,332 |
| K.J.S. Ahluwalia | – | 8,879 | 41,098 | 169,064 | 161,817 | 91,588 | 472,446 |
| Kaypee Enterprises | – | 8,627 | 31,068 | 78,528 | 54,138 | 18,415 | 190,776 |
| Serajuddin Mines | 199,913 | 99,947 | 24,996 | – | 128,798 | 310,232 | 763,886 |
| Others | 10,358 | 14,636 | 11,466 | 12,340 | – | 2,439 | 51,239 |
| Total (1+ 2) | 915,845 | 830,315 | 840,503 | 880,721 | 960,035 | 1,101,360 | 5,528,779 |
Qty in MT
Provisional data
Source: SteelMint Research, Customs, Odisha govt.
Pellet export of Essar Steel moves up significantly – Essar Steel exported 0.43 MnT pellets to China and Japan in Q2 FY17. The company had exported 0.05 MnT pellets to China in Q1 FY17. Increased demand of Indian pellets in China and high pellet premium kept pellet export offers high which lead to increased export.
Essar Steel’s coastal pellet movement rises sharply in Q2 FY17 – As per customs data maintained with SteelMint, in Q2 FY17, Essar Steel moved nearly 2.22 MnT pellets from its Vizag and Paradip plants for its Hazira facility. However in Q1 FY17, the steel giant moved 1.77 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 surged.
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