Essar Steel: Iron ore and Pellet Sourcing Up 34% in Feb’19

Essar Steel - an integrated steelmaker with steel making capacity of 10 MnT p.a. recorded sharp increase in total iron ore & pellet sourcing for the month of Feb’19.

The sourcing stood at 1.03 MnT in Feb’19, up by 34% monthly basis as against 0.76 MnT in Jan’19.
On yearly basis, iron ore & pellet sourcing dropped 11% as against Feb’18 sourcing at 1.16 MnT.

Essar Steel imports recorded nil in Feb’19

Essar Steel's iron ore and pellet imports recorded nil for the second consecutive month in Feb’19.

Iron ore procurement from NMDC (C.G.) up 23% on monthly basis

Essar Steel procured 0.69 MnT of iron ore in Feb’19 from NMDC's Bailadila mines in Chhattisgarh via slurry pipeline, up 23% against procurement in Jan’19 at 0.57 MnT.

The miner had decreased the prices by 11% in beginning of Feb’19. However, on 23rd Feb’19, the miner raised prices upto INR 490/MT.

On yearly basis, the steelmaker depicted 16% rise in Feb’19 sourcing as compared to 0.60 MnT in Feb’18.

Sourcing from Odisha merchant mines increased 65% M-o-M

Essar Steel sourced 0.33 MnT iron ore in Feb'19 from Odisha's merchant mines, up 65% M-o-M as against 0.20 MnT a month ago.

According to sources report, miners increased discount on bulk fines purchase. Many merchant miners in Odisha have mostly utilized their EC limits for the year and are not seen actively offering material in the market. Earlier, Odisha merchant miners had twice raised iron ore prices in the month of Feb'19 following vale incident. Later Essel mining decreased prices by INR 300-400/MT in both lumps and fines.

Out of the total iron ore sourced from Odisha in Feb'19, largest share was contributed by Serajuddin at 0.18 MnT (up 37% M-o-M) followed by Indrani Patnaik at 0.07 MnT and KJS Ahluwalia at 0.06 MnT

Essar Steel's long-standing bankruptcy case

In the latest update on Essar Steel’s insolvency case, the National Company Law Appellate Tribunal (NCLAT) refused Essar Steel’s ex-directors plea to stay the bankruptcy court’s order approving steel giant ArcelorMittal's INR 42,000 crore takeover bid for Essar Steel.

After the Ahmedabad bench of NCLT (National Company Law Tribunal) approved the Arcelor Mittal’s bid on 8 March 2019 to takeover Essar Steel, the company’s three ex-directors challenged NCLT’s order stating that their INR 54,389 crore was superior to Arcelor Mittal’s bid as it clears 100% outstanding of both financial and operational creditors.

Now with NCLAT’s rejection of Essar Steel’s ex-directors plea, the Arcelor Mittal has been indirectly approved as the successful resolution applicant of the company. However, the appellate tribunal has asked Essar Steel’s Committee of Creditors and ArcelorMittal, to submit a fresh money distribution plan for the company.