Steel Exchange India has entered into a memorandum of understanding with NMDC to secure long-term supplies of iron ore fines. The company disclosed the development in a regulatory filing to the BSE and the National Stock Exchange on Tuesday.
Steel Exchange India signs 4-year MoU with NMDC for iron ore supply
The MoU covers the supply and procurement of iron ore fines with an iron content of 61 to 63% and above. The ore will be sourced from NMDC’s upcoming Buffer Stockpile and Blending Yard in Visakhapatnam.
The agreement gives Steel Exchange India multiple modes of access to the material. These include direct conveyor delivery, FOB, FOR, FOT and ex-stockpile options. The company said this will give it more control over the quality and consistency of the raw material feeding its plant.
The pact runs for a primary term of four years. It is meant to serve as the operational blueprint for long-term agreements that the two companies plan to finalise later.
Record Re-Bar output puts focus on reliable iron ore supply
As per the filing, the MoU comes soon after Steel Exchange India reported its highest-ever monthly output of Re-Bar, at 24,823.509 tonnes. The company attributed that jump to the commissioning of a new reheating furnace.
With rolling capacity up, the company has been looking to lock in a steady, reliable ore supply to match its expanded production. NMDC’s Visakhapatnam facility sits close to Steel Exchange India’s own integrated plant in Vizianagaram district, which the company said will cut freight costs and reduce transit times.
It added that the arrangement is intended to support its raw material pipeline and back its Simhadri TMT brand.
Steel Exchange India has positioned the MoU as part of a broader backward integration strategy. The company said it plans to use the tie-up to reduce its exposure to swings in ore prices and availability, at a time when it is also eyeing further capacity expansion.
About Steel Exchange India
Steel Exchange India is the flagship company of the Vizag Profiles Group. The group’s promoters originally traded in steel and related products before diversifying into software in 1999 through Pyxis Technology Solutions, which set up an online steel trading portal called steelexchangeindia.com. That venture was later restructured, and by 2003 the combined entity was renamed Steel Exchange India.
Over the following years, the company built out its operations through a gas-based power plant and ingot unit in East Godavari district, and later took over GSAL (India) Limited, a sponge iron unit near Visakhapatnam that was under rehabilitation at the time. It added a billet-making unit and a rolling mill to that site to consume the sponge iron produced there.
Steel Exchange India share price today
Steel Exchange India’s share price has been up almost 4% as of market opening on September 9. The company’s share price has been up 12.15% in the past month. Furthermore, Steel Exchange India’s share price has been up 24.48% in the past year.