NMDC Ltd plans to launch India’s first branded iron ore product and expects it to command a premium in the market, marking a shift from selling bulk ore to offering material with fixed quality specifications.
The state-run miner has approved an investment of about Rs 3,000 crore to build a blending yard in Visakhapatnam that will allow it to produce iron ore with consistent chemical characteristics, Chairman and Managing Director Amitava Mukherjee said during the company’s earnings call on June 1.
The project forms part of NMDC’s broader expansion strategy as it works towards increasing production capacity to 100 million tonnes by the end of the decade. While the company has largely been viewed as a volume-driven iron ore producer, the blending facility is intended to create a differentiated product that could improve realisations and strengthen its position with steelmakers.
Premium Product
“NMDC will be the first company in three years’ time to be selling branded iron ore,” Mukherjee said.
He said iron ore sold globally is often blended to ensure fixed specifications for iron content and impurities such as silica, alumina and phosphorous. Steel producers use those specifications to improve blast furnace efficiency and maintain consistent production.
In India, miners generally sell ore without such standardised blending, resulting in variations in quality between consignments. The proposed facility will combine ore from different sources to create products that remain within a narrow quality range, similar to branded products sold by major global miners.
“We expect that to be a game changer, in fact, in the iron ore market in India,” Mukherjee said. He added that the company expects the product to attract a premium because of the operational benefits it offers steelmakers.
ALSO READ: NMDC Iron Ore Price Hike: Lump Ore Up Rs 200/Tonne, Fines Rise Rs 150/Tonne
Vizag Expansion Plans
The blending yard will be developed on land acquired by NMDC in Visakhapatnam and is expected to be completed within two to two-and-a-half years.
Mukherjee said the site would also support future projects, including a pellet plant and potential processing facilities for critical minerals. “Apart from that, of course, we’ll have a pellet plant there in due course of time,” he said.
The company has reserved part of the land for future ventures linked to critical minerals and overseas mining acquisitions.
Wider Growth Push
The announcement comes as NMDC expands beyond iron ore.
The company recently opened a dedicated subsidiary focused on rare earths and critical minerals and is pursuing mineral assets overseas. Mukherjee said some acquisition opportunities are in advanced stages, although details cannot yet be disclosed.
NMDC expects to spend between Rs 2,000 crore and Rs 3,000 crore on overseas acquisitions during the current financial year, he said.
The company is also ramping up output from new iron ore and coal assets, including Deposit 4 and Deposit 13 in Chhattisgarh and coal blocks in Jharkhand, as it works towards its long-term production target.
ALSO READ: NMDC Q4 Result: Profit Rises 16%; Announces Final Dividend
