JSW Steel adds Goa to captive mining list with Cudnem-Cormolem mineral block 

JSW's corporate office in Mumbai

Tycoon Sajjan Jindal’s JSW Steel has won an iron ore block in ongoing auctions in Goa, a first for the company, as it seeks higher raw material security, Goa media reports said.

As of FY22, 43 percent of JSW Steel’s iron ore requirements were being met by captive mines, which the steelmaker is targeting to increase to 50 percent.

JSW Steel has quoted the highest premium for the Cudnem-Cormolem mineral block at 96.6 percent of the average sale price set by the Indian Bureau of Mines, the report said.

The company did not officially confirm the development. The block was put up for auction on April 25. Cudnem-Cormolem is one of the five iron mines put on the block in the latest round of auctions.

The Cudnem-Cormolem mineral block is estimated to have resources of about 9.7 million tonnes, a comparatively immaterial figure that’s not likely to make a significant difference to JSW Steel, said an analyst who did not wish to be identified.

This winning bid adds Goa as the third location to JSW Steel’s captive mining list.  JSW Steel holds mining rights to larger reserves in Karnataka and Odisha.

JSW Steel currently has mining rights to nine captive iron ore mines in Karnataka and four in Odisha totaling 216 million tonnes and 1,135 million tonnes of iron ore reserves respectively.

Analysts and rating agencies in the past have noted JSW Steel’s acquisition of captive mining rights in Odisha were at a premium.

JSW Steel said its acquisition of mining rights in Karnataka and Odisha had already started to buoy margins significantly while guarding against price, supply and quality risks.