The Steel Ministry has directed its undertakings, SAIL and NMDC, to explore acquiring mining assets abroad to help secure long-term raw material requirements and support input costs, according to reports from Moneycontrol.com, Rediff Moneynews, and PTI. A senior ministry official confirmed on query that steel PSUs, especially SAIL and NMDC, have been asked to look for mining assets abroad. The move aims to help secure future requirements and reduce costs, though further details were not shared by the official. As per The Economic Times, the official confirmed that Steel Authority of India Ltd (SAIL), the country's largest public sector steelmaker, and NMDC, India's leading iron ore producer, have been asked to look for mining opportunities abroad. The directive comes as the government seeks to reduce import dependency and secure critical raw materials for steel production.
Iron ore and coking coal are two basic raw materials needed to produce steel, alongside limestone and pulverised coal injection (PCI Coal), as reported by Moneycontrol.com, Rediff Moneynews, and PTI. While iron ore is available in abundance in the country, Indian steel makers, including SAIL, remain heavily dependent on imports for 85-90 per cent of their coking coal requirements from countries such as Australia and Mozambique. Similarly, limestone is also imported from the West Asia region. The push for overseas assets comes as steel companies look to gain greater control over their raw material supplies and reduce exposure to volatile international prices.
Private steelmaker JSW Steel has also acquired coking coal assets abroad as part of its plan to achieve 50 per cent of its raw material requirements through captive sources, according to Moneycontrol.com, Rediff Moneynews, and PTI. NMDC, mainly operating in the iron ore production space, is looking to diversify into exploration of other minerals to meet the growing needs of various industries, including steel. The company's Chairman Amitava Mukherjee recently stated that by 2030, his goal is to earn at least 20 per cent of revenues from the sale of minerals other than iron ore, as reported by The Economic Times. For India, securing mineral resources abroad could give steel producers greater visibility over supplies while helping them manage one of the biggest components of their production costs.
