Interesting Article MaybeI found this article and although it is India-centric it does have to do with pellets and iron ore. It is a locked article so I will try to cut and paste it for you. In the middle of the article it mentions how monsoons have disrupted pellet supply.
‘Ore exports should stop until needs of local sector fulfilled’
Ishita Ayan Dutt
There is rising demand from steel companies for a clampdown on iron ore exports, in the wake of shortage. In an interview, Dilip Oommen, chief executive officer of ArcelorMittal Nippon Steel India (AMNS India), tells Ishita Ayan Dutt that cutting down on production owing to shortage of iron ore is not in sync with the government’s Atmanirbhar policy. Edited excerpts:
Has the steel industry demanded restriction on iron ore exports?
Iron ore prices have surged. If you look at Odisha prices, they have jumped 175 per cent since June; NMDC (National Mineral Development Corporation) prices have also risen 84-85 per cent. A major reason is the low availability of iron ore. As a result, the industry is suffering. How can we be exporting iron ore — which is bread and butter for the sector — when we are struggling to make ends meet? Iron ore production is down, but exports are up. We are not against exports per se, but the needs of the domestic steel industry should be met first. Exports should stop until the crisis has been overcome.
Is availability an issue because many of the mines auctioned are not operational?
Many mines are not being brought into operation. We don’t have iron ore to take care of our requirements. If steel production is reduced due to the lack of iron ore, how can we have Atmanirbhar Bharat? Then there are logistical constraints because vehicles have been lined up on the roads, for exports.
What kind of reserves do the mines that are operational have, vis--vis those not in operation? The government needs to get the mines that are not operational to operate, because for one reason or the other they have not started mining. Some of these are large mines that are yet to be operational. All mines that are auctioned should meet the minimum despatch requirement of 80 per cent of MDFA (Mine Development and Production Agreement).
Don’t most of the iron ore exports have low Fe content, which is not used by the steel industry? Right now, we have no access to low or high grade. We have started taking iron ore with 60 per cent Fe and then getting it beneficiated.
How is AMNS India impacted by the iron ore issue?
We have one mine that we promptly brought to production. There is material in the mine but the problem is logistics — from the mine to the beneficiation plant. Further, the stacks in this mine need to move up from 4,000 tonnes to 40,000 tonnes to facilitate storage and speed up despatches.
To what extent has AMNS’ production been impacted?
Our pellet production is being affected. NMDC was hit during monsoon, though production has picked up now. I hope it sustains.
There is growing concern from user industries on steel prices. How would you respond to that?
If input prices keep rising, what are we supposed to do? We have to ensure some level of profitability. If input prices come down, steel prices will also come down. If availability of iron ore goes up, steel production will also pick up, thus helping to bring down the steel price.
AMNS has a plan of increasing capacity to 12-15 million tonnes at the existing facility. What other expansion plans do you have?
We are constantly on the lookout for appropriate opportunities. We are discussing greenfield options with the Central and state governments. We are going stage by stage. Right now, we are doubling capacity in Gujarat and are in discussions for greenfield opportunity in Gujarat itself, along with other states. We will look at suitable opportunities for acquisition too.
There is one opportunity coming up in NMDC, would you look at it?
There is no commitment, but we are looking at all opportunities that arise.
Besides Gujarat, which other states are on the radar?
We are looking at the mineral-rich states.
How fast would AMNS like to scale up in India?
We would like to actively contribute to the Prime Minister’s Atmanirbhar Bharat initiative and the plan of reaching steel capacity of 300 million tonnes. If a conducive environment is provided, we are very keen on increasing our footprint in India