“We are going to have a long-term tie-up with [Sandur Manganese] for a supply of iron ore. They have a capacity of 1.6 million tonnes now, but they can reach up to three million tonnes,” Vinod Nowal, deputy managing director of JSW Steel told Reuters.

Discussions are still pending and no decision has been reached. According to Mr Nowal, JSW will also be bidding aggressively in an iron ore mine auction in July in the southern-western state of Karnataka. It needs 30 million tonnes of iron ore annually to produce 18 million tonnes of steel. Unlike companies such as Steel Authority of India and Tata Steel, JSW does not have access to its own iron ore mines, which is one of the most important materials for steel making.

The mines of Sandur Manganese are located in the Bellary district and are close to JSW Steel’s Vijayanagar unit.