Indian ore makers increased capacity to meet China's demand

October 23 MetalBiz--P. Mukherjee, CEO from Sesa Goa Ltd-the largest iron ore exporter in India said that "the company intends to threefold the production in the following 2-3 years to meet China's active demand". He stated that its production is expected to increase to 50mln tons per year from the current 15mln tons per year.

Sesa Goa Ltd is the largest private iron ore supplier in India and the production base is located in Goa near to Arabian Sea. P. Mukherjee disclosed that in a bid to achieve the aforesaid target, the company not only expand the production capacity in India, but also purchase mines in overseas.

China is the global largest iron ore consumer and importer. Presently more than 70% of iron ore in China depends on import. Australian Bureau of Agricultural and Resource Economics (Abare) which headquarter is in Canberra issued report on September 22 that China' s imported ore for 2010 may increase 20% from the previous forecast. The report also claimed that China is expected to import 637mln tons of iron ore next year, up 180mln tons from the estimated 529mln tons in June. 

P. Mukherjee unveiled that "with the increasing expectation on China' demand, the iron ore market is tending to stabilize", adding "the price and transactions are both improving with stability".

At present, Indian iron ore price (FOB) is U.S. $65-67 per ton, down nearly 30% over U.S.$95 per ton a year earlier.

In the stake exchange of Bombay, the share price of Sesa Goa Ltd drops 8.9% on October 23 and the close offer is 316.60 rupee per share.