Tata Steel collaborates with NMDC and OMC to secure future iron ore supply

Tata Steel has begun negotiations with state-owned enterprises NMDC and Odisha Mining Corporation (OMC) to guarantee a consistent supply of iron ore for its growing steel manufacturing capacity. As part of its strategy to ensure raw material security, the company plans to operationalize two new iron ore mines Kalamang West and Gandalpada.

Currently, Tata Steel sources iron ore from six working mines in Odisha and Jharkhand, including Noamundi, Katamati, Khondbond, and Joda East. However, the licenses for these mines will expire in March 2030. To solve this, Tata Steel has previously planned for the transition, with two additional mines—NINL (Mithirda) and Vijay II—still active after acquiring NINL and Usha Martin’s steel business.

Tata Steel expects to grow its steel production capacity from 22 million tonnes per year (MTPA) to 40 MTPA by 2030, resulting in an annual iron ore need of more than 60 million tonnes. In FY24, the business produced 38 million tonnes of iron ore, which it expects to grow to 41 million tonnes in FY25.

The Kalamang mine is expected to commence operations in Q4 of the current fiscal year, while Gandalpada is slated to start in FY29. These two mines, with a combined reserve of 400 million tonnes, will supply up to 50% of Tata Steel’s iron ore needs. The Gandalpada mine, in particular, will be crucial, producing 10 million tonnes annually.

Tata Steel is in ongoing discussions with NMDC and OMC to fulfill the remaining iron ore demand. These state-run organizations have assured their support, contingent on the submission of a detailed requirement plan. The company’s future strategy will depend on the successful integration of these new mines and partnerships to meet its ambitious growth targets.