India's iron ore output to increase in FY19

Domestic iron ore production is projected to grow by five percent in 2018-19, helped by a stable demand for steel from the infrastructure and automobile industries, industry sources said.

Apart from the anticipated growth in production, demand for iron ore inside the country will be met by the accumulated ore stocks at mine heads mainly in the states of Odisha and Jharkhand which between them account for 80 percent of the piled up inventory.

In FY18, the country produced 210 million tons (mt) of iron ore, up nine per cent year-on-year and breaching the 200 mt mark in output after a hiatus of seven years. Iron ore production had peaked at 218 mt in 2009-10 and later slumped by 40 percent to 136 mt in 2012-13 as key producing states such as Karnataka and Goa were burdened with court-ordered mining bans.

Last fiscal witnessed iron ore output climbing to a high and the same uptrend is expected in 2018-19.

The Supreme Court has hiked the annual production cap in Karnataka from 30 to 35 mt. This will help bring some incremental production. NMDC, the largest miner, has also vowed to scale up output this fiscal.

The domestic demand for iron ore looks positive. That apart, the export markets have shown promise too with China sourcing more of iron ore pellets from India, sources said.