Iron Ore Mining in India to 2020

India is one of the leading producers of iron ore, with estimated total resources of over 28.5 billion tons (bt) of hematite (Fe2O3) and magnetite (Fe3O4) taken together. Of the 294 iron ore mines in 2012, compared to 336 in 2010, 34 were in the public sector, while the remaining 260 were owned by private firms. Production was estimated at 142.9 million tons (Mt) in 2013, which is expected to increase to 284Mt in 2020, growing at a compound annual growth rate (CAGR) of 7.4%. Simultaneously, iron ore consumption over the forecast period (2014–2020) is projected to increase to 238.3Mt in 2020.

Scope

The report contains an overview of the Indian iron ore mining industry together with the key growth factors and restraints affecting the country’s iron ore mining industry. Further, it provides detailed information about production, prices, reserves, reserves by regions, competitive landscape, major active, exploration and development projects, consumption and trade. Also included is the country's fiscal regime, which includes governing bodies and relevant laws, rights and obligations of the mining companies, as well as key fiscal terms.

Key Highlights

• India is one of the leading producers of iron ore, with estimated total resources of over 28.5 billion tons (bt) of hematite (Fe2O3) and magnetite (Fe3O4) taken together. Of the 294 iron ore mines in 2012, compared to 336 in 2010, 34 were in the public sector while the remaining 260 were owned by private firms in 2012.

• The Supreme Court of India, on April 21, 2014, lifted a 19-months old ban on mining in Goa, the top iron ore exporting state. The ban was imposed to protect against illegal mining activities and to achieve its objective, the panel appointed by the Supreme Court suggested capping production at 20Mt.

• India has substantial iron ore resources, with significant deposits of hematite and magnetite. Around 59% of hematite ore deposits are found in the east, while 92% of magnetite ore deposits occur in southern India, especially in the state of Karnataka.

• India’s forecast iron ore production measured 142.9Mt in 2013, a marginal increase of 2% over 2012. Since 2000, iron ore production increased substantially from 80.7Mt to a high of 218.6Mt in 2009, but reported a downward trend after this due to a mining ban in states such as Karnataka and Goa. India’s iron ore production is projected to grow at a CAGR of 7.4% over 2014–2020, to reach 284Mt in 2020.

Reasons to buy

To gain an understanding of the Indian iron ore mining industry, the relevant drivers and restraining factors, historical and forecast production, consumption and trade data and the fiscal regime.

Companies mentioned

National Mineral Development Corporation Ltd

Steel Authority of India Ltd

Sesa Sterlite Ltd

Odisha Mining Corporation Ltd

Tata Steel Ltd

Table of Contents

1 Executive Summary 1

2 Iron Ore Mining in India 7

2.1 Country Overview 7

2.2 Mining Overview 7

2.3 Iron Ore Mining in India – Drivers 8

2.4 Iron Ore Mining in India – Restraints 9

3 Iron Ore Mining in India – Production, Consumption, Reserves and Trade 11

3.1 Reserves by Grade and Geographic Location 11

3.1.1 Hematite Ore Reserves 11

3.1.2 Magnetite Ore Reserves 12

3.2 Historical and Forecast Production 14

3.2.1 Total Production by Form 16

3.3 Total Production by Region/State/Basin 18

3.4 Iron Ore Prices 20

3.5 Competitive Landscape 22

3.5.1 National Mineral Development Corporation Limited (NMDC) 22

3.5.2 Steel Authority of India Limited (SAIL) 23

3.5.3 Sesa Sterlite Limited 25

3.5.4 Odisha Mining Corporation Limited (OMC) 26

3.5.5 Tata Steel Limited 27

3.6 Total Production by Major Mines 29

3.7 Total Production by Mining Method 30

3.8 Major Exploration and Development Projects 30

3.9 Iron Ore Consumption and Trade 31

3.9.1 Domestic Consumption vs. Exports 33

3.9.2 Export to Destination Countries 35

3.10 Demand Drivers 36

3.10.1 Demand vs. Final Use 36

4 Fiscal Regime 37

4.1 India’s Governing Bodies 37

4.1.1 Ministry of Mines 37

4.1.2 Ministry of Coal 37

4.1.3 Indian Bureau of Mines (IBM) 37

4.1.4 Geological Survey of India (GSI) 37

4.1.5 Ministry of Environment and Forests (MoEF) 38

4.1.6 Coal Controller 38

4.1.7 Department of Atomic Energy (DAE) 38

4.1.8 Atomic Minerals Directorate (AMD) for exploration and research 38

4.1.9 Atomic Energy Regulatory Board (AERB) 38

4.2 India’s, Governing Laws 39

4.2.1 Mines Act, 1952 39

4.2.2 Mines and Minerals (Development and Regulation) Act, 1957 39

4.2.3 The Coal-Bearing Areas (Acquisition and Development) Act, 1957 39

4.2.4 The Atomic Energy Act, 1962 39

4.3 India’s, Mining Ownership and Licenses 40

4.3.1 Mining Licenses 40

4.4 India’s, Rights and Obligations 42

4.4.1 Rights 42

4.4.2 Obligations 42

4.5 India’s, Key Fiscal Terms 43

4.5.1 Fees 43

4.5.2 Rent 43

4.5.3 Royalty 43

4.5.4 Corporate Tax 46

4.5.5 Surcharge 46

4.5.6 Education Cess 46

4.5.7 Clean Energy Cess 46

4.5.8 Clean Energy Cess 46

4.5.9 Branch Profits Tax (BPT) 47

4.5.10 Withholding Tax 47

4.5.11 Losses Carry Forward 47

4.5.12 Deductions 47

4.5.13 Depreciation 47

4.5.14 Value Added Tax (VAT) 47

4.5.15 Tax Incentives 48

4.5.16 Tax Treaties 48

5 Appendix 49

5.1 What is This Report About? 49

5.2 Methodology 49

5.3 Secondary Research 49

5.4 Primary Research 49

5.5 Contact GlobalData 50

5.6 About GlobalData 50

5.7 GlobalData’s Services 50

5.8 Disclaimer 52

List of Tables

Table 1: Iron Ore Mining in India – Hematite Ore Reserves, (Million Tons), as of March 2010 11

Table 2: Iron Ore Mining in India – Hematite Ore Reserves by Region/State, (Million Tons), as of March 2010 12

Table 3: Iron Ore Mining in India – Magnetite Ore Reserves, (Million Tons), as on March 2010 12

Table 4: Iron Ore Mining in India – Magnetite Ore Reserves by Region/State, (Million Tons), as of 2010 13

Table 5: Iron Ore Mining in India – Specifications of Various Grades of Iron Ore Lumps (Guaranteed %), 2014 13

Table 6: Iron Ore Mining in India – Specifications of Various Grades of Iron Ore Fines (Guaranteed %), 2014 14

Table 7: Iron Ore Mining in India – Total Production, (Million Tons), 2000–2020 15

Table 8: Iron Ore Mining in India – Total Production by Forms – Lumps, Fines and Pellets, (Million Tons), 2000–2020 18

Table 9: Iron Ore Mining in India – Total Production by States, (Million Tons), FY 2008–2011 19

Table 10: Iron Ore Mining in India – National Mineral Development Corporation Limited (NMDC), Major Projects 22

Table 11: Iron Ore Mining in India – Steel Authority of India Limited (SAIL), Major Projects 25

Table 12: Iron Ore Mining in India – Sesa Sterlite Limited, Major Projects 26

Table 13: Iron Ore Mining in India – Odisha Mining Corporation Limited (OMC), Major Projects 27

Table 14: Iron Ore Mining in India – Tata Steel Limited, Major Projects 29

Table 15: Iron Ore Mining in India – Major Active Mines 29

Table 16: Iron Ore Mining in India – Major Development Projects 30

Table 17: Iron Ore Mining in India – Major Exploration Projects 31

Table 18: Iron Ore Mining in India – Total Consumption, (Million Tons), 2000–2020 32

Table 19: Iron Ore Mining in India – Domestic Consumption vs. Exports, (Million Tons), 2000–2020 34

Table 20: Iron Ore Mining in India – Export to Region and Destination Countries, (Million Tons), 2013 35

Table 21: Mining Industry in India – Dead Rent Rates Per Hectare (INR), 2014 43

Table 22: Mining Industry in India – Coal and Lignite Royalty Rates, (INR), 2014 45

Table 23: Mining Industry in India – Coal Middlings Royalty Rate, (INR), 2014 45

Table 24: Mining Industry in India – West Bengal Coal and Lignite Royalty Rates Per Tons, 2014 46

Table 25: Mining Industry in India – Withholding Taxes (%), 2014 47

Table 26: Mining Industry in India – Depreciation Rates (%), 2014 47

List of Figures

Figure 1: Iron Ore Mining in India – Significant Mineral Potential Remaining Untapped 10

Figure 2: Iron Ore Mining in India – Total Production, (Million Tons), 2000–2020 15

Figure 3: Iron Ore Mining in India – Total Production by Forms – Lumps, Fines and Pellets, (Million Tons), 2000–2020 17

Figure 4: Iron Ore Mining in India – Share of Total Production by State, (%), FY 2011–2012 19

Figure 5: Iron Ore Mining in India – Average Domestic Sale Price of Indian Iron Ore – Lumps, (INR/ton), October 2009–2013 20

Figure 6: Iron Ore Mining in India – Average Domestic Sale Price of Indian Iron Ore – Fines, (INR/ton), October 2009–2013 21

Figure 7: Iron Ore Mining in India – Total Consumption, (Million Tons), 2000–2020 32

Figure 8: Iron Ore Mining in India – Domestic Consumption vs. Exports, (Million Tons), 2000–2020 33

Figure 9: Iron Ore Mining in India – Export to Destination Countries (%), 2013 35

Figure 10: Chinese Iron Ore Imports (Tons), 2008–2013 36

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