AMNS India keen to expand India footprint if it gets conducive environment

In an interview with Ishita Ayan Dutt, ArcelorMittal Nippon Steel India CEO Dilip Oommen makes a case for curbs on export of iron ore amid a shortage for domestic markets

At a time when there is a growing demand in India for a clampdown on iron ore exports by steel companies, given a shortage in the domestic market, Dilip Oommen, chief executive officer of ArcelorMittal Nippon Steel India (AMNS India), tells Ishita Ayan Dutt in an interview that cutting down steel production amid iron ore shortage is not in keeping with the government’s Atmanirbhar policy. Edited excerpts:

Has the steel industry demanded a restriction on iron ore exports?

Iron ore prices have gone through the roof. If you look at Odisha prices, it has gone up by 175 per cent since June. NMDC prices have also risen by 84-85 per cent since then. Availability of iron ore is one of the major reasons for a price increase. As a result, the steel industry is suffering. How can we exporting iron ore, which is bread and butter for the steel industry, when we are ourselves struggling to make ends meet? Iron ore production is down, but exports are up. We are not against exports, but the needs of the domestic steel industry should be met first. Export should stop until the present crisis is over.

Is availability an issue because many of the mines that have been 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 cut down due to lack of iron ore availability, how can we have Atmanirbhar Bharat? Then there are logistical constraints because vehicles are lined on roads for exports.

What kind of reserves do the operational mines, including yours, have vis-à-vis those that are not operational?

The government needs to get the mines that are not operational to operate. Some of these are large mines. All the mines that have been auctioned should meet the minimum despatch requirement of 80 per cent of Mine Development and Production Agreement (MDFA).

But the bulk of iron ore that is exported has a low Fe content. The steel industry does not use that...

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 which we promptly brought to production. There is material in the mine, but the problem is logistics, from mine to the beneficiation plant. Also, 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 is AMNS production impacted?

Our pellet production is affected. NMDC was affected during monsoon, but now production has picked up. I hope it sustains.

There is a 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, helping bring down the steel price.

AMNS has a plan of increasing capacity to 12-15 million tonnes at the existing facility, but what other expansion plans are being considered?

We are on a constant 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. We are also in a discussion for greenfield opportunity in Gujarat itself and other states. We will look at suitable opportunities for acquisition as well.

There is one opportunity coming up in NMDC, would you look at it?

There is no commitment, but we are looking at all such opportunities that come up.

Apart from Gujarat, which are the other states on your radar?

We would look at 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.