Eyeing mining possibility of strategic minerals in India and abroad: NMDC Chairman, Sumit Deb

When we started out this year, a target production of 48 mt was achievable. But after a good start during early part of Q1 (April–June), the demand from the steel industry shrunk and the early onset of monsoon in the Bailadila (Chhattisgarh) and Donimalai (Karnataka) sectors – two of our largest mines – led to a set back to our production. Iron ore being bulk commodity with cyclical nature also was hit by poor demand for steel. However, Q2 onwards we are witnessing a recovery. So by end of Q2 or Q3 onwards we should be on track to achieve 46-47 mt.

I believe prices have bottomed out. And beyond this point, there actually isn’t a scope of further price reduction.

As you know, 10 – 15 per cent of steel production, especially the flats, have always been exported. And as a result of the export duty (on steel), exports have fallen. So to that extent the demand for iron-ore (by steel-makers) is not there. If you look at the major steel producers they’ve reduced their off-take and to that extent our production and demand has also been hit.

NMDC has experienced an almost 30 per cent fall in demand and reduction in production.

The government is aware of the situation and it will take a call when the time is appropriate. 

We are not into the export market. So for us to approach the government for reduction in duties is a little difficult.

If you look at the previous regime, there was duty on export of iron ore for iron content 58 per cent and above (called high grade ores); while ores with 58 per cent and less (low grade ores) carried nil or no duty. The idea was and continues to use the higher grade ore (of 58 per cent and above) for domestic industry. We have no intention to get into export of high grade ores, duty or not.

But, yes, we are open to tapping export market for lower grade iron ores (of 58 per cent and below) especially when the domestic industry is not using these grades.

The Government has been asking us to invest and explore mining possibilities in lithium, cobalt, nickel -what are nowadays called as EV battery minerals – and strategic minerals in India and overseas. So we will be looking at them at some point of time.

In India, we have been given a prospecting license of lithium in Karnataka’s Raichur district. We will start the exploration there soon.

As a country, India does not have much reserves of lithium. These would mostly have to come from outside. We would be leveraging the Australian subsidiary, Legacy, for exploration and mining in Australia (Mt Bevan – a magnetite iron ore soruce). We have got 21 mining tenements there which include these strategic minerals including gold.

We intend to complete the demerger by Q2-end. We are awaiting some clearances from the Ministry of Corporate Affairs and once these come, we will go ahead with the demerger.

In terms of going on-stream, the 3 million tonne per annum plant is expected to be operational in September. The cost estimate is around Rs 22,000 crore.

Not really. Our focus is on iron-ore and value added segments. So going forward we would look at ramping up our pellet-making capacities from the existing 1.2 mt capacities. We are exploring some options already.