Odisha- India’s largest iron ore producing state recorded merchant iron ore dispatches at 6.03 mn t in Jan’21, down 12% against 6.82 mn t in Dec’20. The figures exclude movements for export and dispatches from captive mines- SAIL, JSW (Gonua &Narayanposhi) & Tata Steel, and include dispatches from Sarda Mines, JSW Steel (Jajang & Nuagaon) & AM/NS, India movements.
Key highlights
- JSW Steel recorded the highest dispatches at 1.34 mn t for the month against 0.79 mn t in Dec’20. On 17th Jan’21 SteelMint reported that JSW Steel achieved a major milestone with its iron ore dispatch surpassing 100,000 t on a single day from its acquired mines in the state of Odisha
- OMC, state-owned miner, recorded 27% fall in dispatches to 0.98 mn t for Jan’21 as against 1.35 mn t in Dec’20.
- Dispatches of iron ore from Rungta Mines were down by 26% to 0.79 mn t in Jan’21, as compared to 1.08 mn t in Dec’20.
- Sarda mines dispatches dropped by 55% to 0.73 mn t in Jan’21, as compared to 1.63 mn t in Dec’20. In the last week of Jan’21, Sarda Mines was slapped with a demand of INR 2056 cr for producing the permitted annual limit of Thakurani B iron ore block in February and March of 2020.
- AM/NS iron ore dispatches were recorded at 0.46 mn t for Jan’21 as compared to 0.33 mn t a month ago (Dec’20).AM/NS inked a mine development and production agreement (MDPA) with the district of Sundargarh last week. With environmental clearances and the MDPA, AM/NS is only a grant away from starting work on the 99.59 mn t greenfield iron ore deposit, its second in the country.
India- Odisha Iron ore Dispatches in Jan’21 & Dec’20
Figure Included, Sarda Mines, JSW Steel (Jajang & Nuagaon) & AMNS Movements
Figure excluded SAIL, Tata & JSW Steel (Gonua &Narayanposhi) captive movement
Qty in mn t
Source: SteelMint
Provisional Data
Outlook:The Union Ministry of Mines has proposed to amend the Minerals Concession Rules, 2016 (MCR) in order to build up the minimum dispatch rule for miners failing to meet production and dispatch targets. Rule 12A(1) of MCR, 2016 states that all new lessees conferred with vesting orders are required to ensure minimum dispatch of 80% of the average annual production of the two immediately preceding years on a pro-rata basis.
Furthermore, the ministry’s draft notification states: “In case the lessee does not maintain minimum dispatch for three consecutive quarters, the State Government may terminate such lease.” This is likely to boost supplies in the near term.
India’s Ministry of Mines has sought public opinion on a series of reforms that could significantly improve supplies and offer new mines for auction. Captive mines are now allowed to sell half their production in the open market. They must pay an additional amount of royalty, depending on the mineral. For Iron Ore the additional amount is equivalent to 2.5 times (Lumps) and 1.5 times (Fines) of the Royalty Payable.
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