MUMBAI (Reuters) - JSW Steel Ltd, India's No. 3 maker of the alloy, said it expects to increase imports of iron ore by up to 80 percent to 900,000 tonnes a month due to a domestic shortage and a slump in international prices.
The company, which posted better-than expected quarterly profit on Tuesday, will also participate in government auctions for coal mines for captive consumption, a senior company official said on Tuesday.
Domestic iron ore supply has been restricted in India by curbs on illegal mining in key states, causing companies like JSW Steel to bank on depressed global iron ore prices and increase imports.
"We are increasing the total imports per month, it is a necessity for us," JSW Steel's Joint Managing Director Seshagiri Rao told reporters, pointing to a more than 40 percent increase in domestic iron ore prices since January.
Global iron ore prices have fallen about 40 percent in that period.
Rao added that the company expects to raise iron ore imports to 800,000 tonnes to 900,000 tonnes per month from its current 500,000 tonnes per month levels.
JSW needs about 22 million tonnes of the steel making raw material per year to make steel but did not import any last year. It has imported about 1.7 million tonnes in the first half of this fiscal, Rao said.
The company also expects to bid for mines that would be available after the government on Monday announced plans to auction coal-bearing land which was taken back from private companies whose mining licenses were cancelled by the Supreme Court last month.
"As and when that gets finalised, we will definitely participate in the auction," Rao said, after the company posted a consolidated profit of 7.49 billion rupees ($122.17 million) in its fiscal second quarter, beating average analyst expectations of a 6.97 billion rupee profit.
JSW Steel shares closed up 2.8 percent in a Mumbai market that was rose 0.55 percent on Tuesday.
(1 US dollar = 61.3100 rupee)
