Tata Steel plans to increase its steel production capacity to 40 million TPA by 2030. The target will require 60 million tonnes of annual iron ore. The company is holding negotiations with the National Mineral Development Corporation (NMDC) and the Odisha Mining Corporation (OMC) to meet 50 percent of its iron ore needs in future.
Dec 16, 2024
In order to secure iron ore supplies for its expanding steel production capacity, Tata Steel is holding negotiations with the National Mineral Development Corporation (NMDC) and the Odisha Mining Corporation (OMC).
According to Mr. DB Sundara Ramam, Vice President of Raw Material at Tata Steel, the company was currently fulfilling its iron ore requirements entirely from six operational mines in Odisha and Jharkhand. Out of these, the lease of Noamundi, Katamati, Khondbond and Joda East mines would expire in March 2030.
The Neelachal Ispat Nigam Limited (NINL) in Odisha and Vijay II in Jharkhand, which had been acquired through the takeovers of NINL and Usha Martin’s steel business, would remain operational.
As per Mr. Ramam, Tata Steel has created a roadmap to meet the iron ore demand for its planned increase in steel production capacity from 22 million TPA to 40 million TPA by 2030. The company produced 38 million tonnes of iron ore in FY24 and aimed to produce 41 million tonnes in FY25. it would require over 60 million tonnes of iron ore annually to achieve the targeted steel output.
The company planned to operationalise two new iron mines at Kalamang West and Gandalpada in Odisha. The timeline aligned with the expiry of leases for four existing mines, which would subsequently go up for auction, said Mr. Ramam.
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The Kalamang mine, having an estimated annual output of 10 million tonnes, was likely to commence operations in the fourth quarter of the current fiscal year. It would play a crucial role during this transitional phase. Gandalpada was slated for production by FY29. The estimated reserves of the Kalamang and Gandalpada mines were approximately 400 million tonnes. Tata steel was looking forward to meeting 50 percent of its iron ore needs through Kalamang, Gandalpada, NINL (Mithirda) and Vijay II iron ore mines.
In order to fulfill the remaining demand, the company was holding parleys with NMDC and OMC. As per Mr. Ramam, the procurement team of Tata Steel held meetings with the PSUs. Both the companies have assured their support in providing the necessary quantities of iron ore, pending the submission of a detailed requirement plan, he added.
