Indian iron ore production plunged 24.3% year-on-year in December to 11 million tonnes. The total value of this output was INR 2,500 crore ($399.7m), Kallanish learns from the Indian mines ministry. This was, however, up from 9.2mt in December.

Manganese ore and chromite production during the month also declined by -27.6% and -33% respectively to 169,000t and 197,000t.

India is undertaking an ambitious programme to increase its crude steel capacity to 300m tonnes/year by 2025, which will require 500m t/y of iron ore. However, the shutdown by authorities of numerous iron ore mines last year has resulted in a domestic shortage of the raw material. This has also pushed up local ore prices, while internationally they remain depressed. Various steelmakers, such as Jindal Steel & Power (JSPL), JSW Steel and Kalyani Steels, have consequently turned to iron ore imports.

Production of coal in January, meanwhile, increased 1.8% to 58.1mt, at a value of INR 7,938 crore. Nevertheless, a domestic shortage remains after India cancelled last September 214 of the 218 coal blocks awarded to companies since 1993. This has contributed to India becoming the world’s third-largest coal importer, despite possessing the world’s fifth-largest coal reserves. JSW Steel, JSPL and Steel Authority of India have thus stepped up thermal and coking coal imports in recent months.

The country is in the process of carrying out coal block auctions that are seen eventually easing the shortage. State-owned Coal India Limited, meanwhile, has been tasked to double annual production to 1 billion tonnes by fiscal year 2019/20.