NEW DELHI, Dec 15: Tata Steel has commenced talks with state-owned miners NMDC and Odisha Mining Corporation (OMC) to secure future iron ore supplies as the company expands its domestic steel production capacity.
The company plans to operationalize two new iron ore mines, Kalamang West and Gandalpada, to bolster its raw material security, according to D B Sundara Ramam, Tata Steel’s Vice President of Raw Material, in an interview with PTI.
Currently, Tata Steel fulfills its entire iron ore demand, a crucial component in steel manufacturing, through six iron ore mines owned by the company in Odisha and Jharkhand.
Ramam highlighted that a raw material strategy has been developed due to the impending expiration of leases for four mines — Noamundi iron ore mine (operating since 1925), Katamati and Khondbond (since 1933), and Joda East (since 1956) — which will expire in March 2030.
Conversely, two other mines, NINL (Mithirda) and Vijay II, will continue their operations as they were acquired alongside the NINL plant and Usha Martin’s steel operations, he added.
“We have a plan ready,” Ramam stated when questioned about the company’s strategy to secure iron supplies while aiming to increase domestic steel production capacity to 40 million tonnes per annum (MTPA) by 2030, up from the current 22 MTPA.
In FY24, Tata Steel produced 38 million tonnes of iron ore and intends to raise that figure to 41 million tonnes in FY25. To meet its goal of 40 MTPA steel output, the firm will require over 60 million tonnes of iron ore.
Outlining the plan, the VP mentioned that the company aims to begin operations at the Kalamang iron ore mine in the fourth quarter of the current financial year and at Gandalpada by 2029, as four mines are scheduled for auction after that year.
“We are uncertain if we will acquire those mines. Therefore, we plan to commence production at Gandalpada in FY29, ensuring that when the other mines are auctioned and potential transitions occur, this mine can supply the full 10 million tonnes,” he explained.
The total estimated reserves for the Kalamang and Gandalpada mines are expected to be around 400 million tonnes, according to the VP.
He further noted that Kalamang and Gandalpada, along with NINL (Mithirda) and Vijay II, will be capable of supplying Tata Steel with 50 percent of its iron ore requirements.
Additionally, Tata Steel has engaged with NMDC and OMC to fulfill the remaining demand in the future, Ramam confirmed.
“We are in discussion with OMC and NMDC to procure additional ore. Our procurement team has met with both entities, and they have assured us they will provide iron ore,” he stated.
NMDC and OMC have also requested a rough estimate of the company’s iron ore needs so they can prepare the necessary quantities to ensure timely delivery, he added.
Tata Steel manages India’s first and oldest steel plant located in Jamshedpur, Jharkhand, which has a capacity of 11 MTPA.
In September, the company inaugurated India’s largest blast furnace at its Kalinganagar plant in Odisha, raising the site’s capacity to 8 MTPA.
In recent years, Tata Steel’s production capacity has increased due to its acquisitions of Bhusan Steel (5.6 MTPA) and NINL (1 MTPA) in Odisha, as well as Usha Martin’s steel operations (1 MTPA) in Jharkhand.
The firm aims to cater to the increasing demands of various sectors including automotive, infrastructure, power, oil & gas, shipbuilding, and defence. (PTI)
