JPM-India Iron Ore Imports surge as domestic production falters. Whats next？-20250721

India’s iron ore imports are growing at high double digits YoY for the third straightquarter while exports continue to trend lower. We believe this is likely driven bysoft domestic production growth (last 9M growth of only 1% YoY) amid risingcrude steel production (+8% YoY LFL growth). Our analysis of import data andrecent news reports suggests that the surge in imports is largely driven by JSW Steelwhich is delivering strong steel production growth. While several iron ore playersin India (like NMDC, OMC, Lloyds Metals) have guided to higher productiontargets in FY26 & beyond, we believe the trend of exports (declining)/imports(rising) is likely to continue at least in the next few quarters. We forecast India’siron ore consumption CAGR of 6% for FY25-31E, which broadly matches thehistorical production CAGR of 5-6%. Our Australian metals and mining teamforecasts iron ore prices at $100/t in 2025 and $95/t in 2026. Iron ore prices haverallied in recent trading sessions on hopes of China stimulus. Rising iron ore priceswould be positive for integrated steel players like TATA (OW), SAIL (N).However, we anticipate lower iron ore prices in FY27-28, particularly as Simandoushipments are accelerated to Nov-2025. Thus, we remain UW on NMDC.

•Our iron ore supply-demand model suggests imports could rise in FY26-27E while exports should continue to trend lower. We expect imports toreach 9-11MT in FY26-27E v. 5-6MT levels in FY24-25. Exports peaked at37MT in FY24 and declined to 24MT in FY26, we anticipate 21MT of exportsin FY26 and forecast a future export run-rate of ~15MT.

•JSW is ramping up iron ore mining and has also announced a JV to mineand beneficiate low-grade iron ore. JSTL reiterated plans to commissionthree new mines in Karnataka during FY26 (targeting 15MT volumes inFY26). The mines in Goa will be fully ramped up in FY27 and produce 3.7MT(one in 3QFY26 and the other two in 2HFY27). We expect FY27-FY28 to seea sharper ramp up in production.