Isigni icant augmentation in this iscal.

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2 Indian Production Likely to Touch 180 MnT in FY17 ndia s iron ore production is witnessing Isigni icant augmentation in this iscal. SteelMint anticipates state's iron ore production to touch 180 MnT in this iscal. Thus compared to 155 MnT iron ore produced in, India's iron ore production is expected to grow 16% Y-o-Y in FY17. So far in this iscal, (till Dec 16) India s iron ore production summed up to MnT, up 28% Y-o- Y. From Apr 15-Dec 15, India s iron ore production was recorded at MnT. States like Odisha, Chhattisgarh, Goa and Karnataka have reported sharp increase in iron ore production this iscal. Pg 01

3 India's State-wise Production in Vs *FY17 data updated till Nov' Rajasthan Madhya Pradesh Chhattisgarh 14 Jharkhand Odisha 19.1 West Bengal Odisha's iron ore production crosses 75 MnT during Apr'16-Jan'17- India s largest iron ore producing state - Odisha has been witnessing sharp increase in iron ore production. Increased production from operational mines has escalated state s iron ore production in this fiscal. So far in this fiscal (till Jan'17) Odisha iron ore production was recorded at MnT up 29% Y-o-Y. In the same period last fiscal, the figure stood at MnT. The government expects the state iron ore production to touch 100 MnT in FY17. Apart from domestic dispatches, iron ore exports from the state have also gained momentum in current fiscal Mahararastra Goa 25 Karnataka Andhra Pradesh Source: Indian Bureau of Mines Production in MnT Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Provisional data Odisha Production : FY17 Vs FY17 Source: Odisha govt Pg 02

4 Rungta Mines remained the largest merchant iron ore producer in Odisha and has recorded production of MnT during Apr-Jan'17. Other major producers were Serajuddin Mines MnT and KJS Ahluwalia at 5.20 MnT. OMC's iron ore production in the same time frame was recorded at 3.33 MnT. Production of iron ore of major captive miners were as follows: Tata Steel at 9.47 MnT and SAIL at 5.69 MnT. NMDC's iron ore production from Chhattisgarh climbs sharply in FY'17 India's largest iron ore producer - National Mineral Development Corporation (NMDC) has also increased considerably in this fiscal. NMDC's total iron ore output stood at 27.1 MnT during Apr-Jan'17 against 23.4 MnT in the same period last fiscal, thus up by 16% Y-o-Y. In, NMDC's iron ore production from Chhattisgarh was recorded at 16.6 MnT. Witnessing sharp rises in production this year, NMDC during Apr-Jan'17 produced 17.2 MnT from its Bailadila mines in Chhattisgarh. SteelMint expects Chhattisgarh state's iron ore production to grow 11% Y-o-Y in FY NMDC's Production : Vs FY17 FY17 Iron ore production in Karnataka to remain similar to last fiscal In, iron ore production from Karnataka was recorded at 25 MnT. So far in FY17 (till Jan'17) NMDC produced 9.87 MnT iron ore from its mines in Karnataka. In, NMDC's production from Karnataka mines stood at 11.7 MnT. Goa's iron ore production increased sharply in FY17 Iron ore production from the state of Goa which stood at 1.78 MnT in has moved up to 2.81 MnT during Apr-Nov'16. Low-grade iron ore exports have increased significantly in this fiscal Considering iron ore output of other states like Jharkhand, Madhya Pradesh, Rajasthan Maharshtra and Andhra Pradesh, India's total iron ore production is expected to touch 180 MnT in FY17. 0 Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar Pg 03

5 IRON ORE MARKET SCENARIO Iron ore prices Indian Prices Mine/Origin Size (mm) Grade (Fe %) Current Price Last Month s Lowest Last Month s Highest M-o-M Remarks Rungta Mines, Odisha Essel Mining, Odisha Indrani Patnaik, Odisha KJS Ahluwalia, Odisha Serajuddin Mines, Odisha Kaypee Enterprises, Odisha NMDC, Chhattisgarh ,900 3,600 3, ,600 3,400 3, Fines 63 1,675 1,675 1,675 = ,350 3,050 3, ,250 2,950 2, Fines 63 1,275 1,275 1,275 = No Offers No Offers No Offers Fines ,200 2,900 3, ,000 2,750 3, Fines 63 1,375 1,375 1,375 = ,000 2,700 3, Fines 63 1,350 1,350 1,350 = ,100 2,800 3, ,900 2,650 2, Fines 63 1,385 1,385 1,385 = 10-40, DR CLO 67 2,790 2,745 2, , ROM 65 2,195 2,100 2, , Baila Lump 65 2,425 2,325 2, Baila Fines 64 2,185 2,085 2, Odisha based major merchant miners hiked iron ore lump prices up to INR 300/MT however fines prices continues to remain unchanged. NMDC hiked iron ore prices for its Chhattisgarh mines upto 5% for Mar 17 deliveries. Karnataka e-auctions Goa e-auctions Lump 63 2,690 2,415 2, NMDC raised base prices for Karnataka Fines 60 2,240 2,000 2, iron ore e-auctions in Mar 17 by INR /MT. Lump = 18the-auction was held on 22 Nov 16. Since then Fines ,420 1,420 1,420 = no further e-auction has been conducted. Global iron ore prices Australia Fines India Fines 58/ Fe 62% fines index increased sharply amid hike in steel futures. Indian prices in INR/MT, Global prices in USD/MT, CFR China Rungta Mines & Indrani Patnaik prices are loaded to wagons & incld Royalty, DMF & NMET, rest Odisha miners prices are ex-mines NMDC (C.G.) prices are FoR, Royalty, DMF, NMET & other taxes extra Karnataka e-auction bid prices are weighted avg & basic Goa e-auction bid prices are basic Pg 04

6 Indian Iron ore Production, Sales, Imports & Exports Particulars Particulars Dec'16 Jan 17 Feb 17 Remarks Odisha iron ore production & dispatches Production So far in this fiscal (till Jan'17) Odisha iron ore production touched 75.6 MnT, up 29% Y-o-Y Dispatches In FY17 (till Jan'17) Odisha based merchant miners have dispatched MnT iron ore. NMDC iron ore production & dispatches Production In FY17 (till Jan'17) NMDC's iron ore production is recorded at 27.1 MnT. Sales So far in this fiscal (i.e. till Jan'17) NMDC's iron ore sales stood at MnT (up by 21% Y-o-Y). Imports JSW Steel was the largest importer at 0.16 MnT followed by KIOCL at 0.06 MnT. Indian iron ore imports & exports Exports Vedanta was the largest exporter at 0.71 MnT followed by Fomento Resources at 0.48 MnT and Rungta Mines at 0.37 MnT. Odisha dispatches fig are excluding captive iron ore movement of SAIL, Tata Steel, JSPL and movement for exports Odisha production figures includes that of captive miners - SAIL, Tata Steel & JSPL Source: Odisha govt., NMDC, Customs, SteelMint Research Iron ore/pellet sourcing pattern of India s major steel makers Name of steel making company Qty in MnT Iron ore /Pellets Provisional data, Source: SteelMint Research, Customs Nov 16 Dec 16 Jan 17 JSW Steel Iron ore Essar Steel Bhushan Steel Iron ore Pellets Iron ore Pellets Pellet prices Region/ Particulars Grade Current Prices Last Month s highest Last Month s lowest DOMESTIC PELLET PRICES M-o-M Barbil 63 4,600-4,700 4,400 4, Jharsuguda 63 4,800 4,400 4, Durgapur 63 5,100-5,400 4,500 5, Raipur 63 4,900 4,700 4, Bellary 63 6,200 5,600 5, Kandla 63 6,750 6,200 6, GLOBAL PELLET PRICES FoB India Remarks Domestic pellet offers gained momentum amid increase in P-DRI prices and improved pellet trade activities. Though Indian pellet exporters were expecting higher bids in export tenders but low pellet premium resulted in lesser bids. Prices in INR/MT, Barbil prices are loaded to wagons, Kandla prices are delivered, rest prices are basic FoB India prices in USD/MT Pg 05

7 Indian Pellet Imports & Exports Particulars Dec 16 Jan 17 Feb 17 Remarks Pellet imports 0.09 Nil - Feb'17 did not observe any pellet import shipment to India. Pellet exports Rashmi Metaliks remained the largest pellet exporter in Feb'17 and exported 0.2 MnT pellets followed by BRPL at 0.17 MnT and Essar Steel at 0.16 MnT. Qty in MnT MILL SCALE MARKET SCENARIO Mill Scale Prices Particulars Grade Prices Last month s highest Last month s lowest Remarks Raipur Fe 70/68% 2,200 2,200 2,000 Domestic mill scale prices moved up Kandla Fe 70/68% 3,100 2,600 2,400 in Feb'17. FoB India Fe 70/68% Raipur prices are ex-works and Kandla prices are delivered in INR/MT FoB India prices are in USD/MT Source: SteelMint Research Indian mill scale exports Dec'16 Jan'17 Feb'17 Remarks 52,500 20,000 18,500 Qty in MT Source: SteelMint Research, Customs DOMESTIC PRICES GLOBAL PRICES Mill scale export offers moved up in Feb'17amid increase in iron ore prices in China. Feb'17 witnessed single mill scale export shipment of 18,500 MT from Kandla port to China via vessel name Han Ren. Source: SteelMint Research, Customs GLOBAL MARKET SCENARIO Spot lump and pellet premium Particulars Spot Lump Premium Spot Pellet Premium Size/ grade Current Premium Fe 62% BF grade, Fe 65% Premium in USD/MT, CFR China 17-5 M-o-M Remarks Spot iron lump premium increased marginally in Feb'17. Iron ore export by world's major countries Spot pellet premium fell sharply in Feb'17 as Chinese buyers were seen preferring sinter/fines. Country Oct 16 Nov 16 Dec 16 Australia Brazil South Africa Canada Russia Sweden Source: Customs data Pg 06

8 REPORT BY Iron ore import by world's major countries Nishtha Mukerjee (Analyst) Call: Parul Jain (Analyst) Country Oct 16 Nov 16 Dec 16 China Japan South Korea Taiwan France U.K Source: Customs data Sunil Parkhe Analyst HEAD OFFICE #301, Jeevan Parisar, Rajeev Nagar Behind Crystal Arcade Raipur (C.G) India Web: China's crude ROM production Oct'16 Nov'16 Dec Source: National Bureau of Statistics Vessel freight to China Route Vessel Type Freight in USD/MT Indian East Coast Supramax 7.50 Brazil Capesize South Africa Panamax INDIA OFFICE RAIPUR KOLKATA DISCLAIMER: This report is an exclusive copyrighted work of steelmint.com and cannot be re-used or published without prior permission from SteelMint. The company shall not be liable for any decisions being made based on the data and information contained in the report. It shall also not be liable for any consequences, inaccuracies and omissions contained therein. Pg 07