Indian integrated steel producer JSW Steel is planning to ramp-up iron ore production from its captive mines. The move comes as the company is finding sourcing iron ore from the open market costlier. It wants to meet 51pc of its iron ore requirement from the captive mines by March 2021 against the present procurement of 27pc.
By the end FY21, out of the total 51pc iron ore requirement from captive mines, the company plans to meet 85pc at the Dolvi plant, 100pc at the Salem plant, and 35pc at the Vijayanagar plant. The company expects strong steel demand to continue in the coming months especially because of the high orders form automobile, solar, appliances and packaging industries.
JSW Steel acquired four iron ore mines — Jajang, Nuagaon, Ganua and Narayanposhi — in Odisha in February 2020. These mines have a combined reserves of 1,131mn mt, or almost 60pc of total iron ore reserves in Odisha. At full capacity, these four mines can produce around 36mn mt per annum and meet about 70pc of JSW’s requirements.
JSW Steel has three more mines in Karnataka where output will be increased from 4mn mt to 7mn mt.
With improved margins and rise in global steel prices, the steelmaker expects strong performance over the remaining months of this financial year. The company plans to bring down the debt to EBITDA to 3.75 times by March 2021 from the present 4.73 times.