State-owned Steel Authority of India Ltd. posted crude steel production of 3.70 million mt for the three months ended September 30, down 3.4% from 3.83 million mt the year before, the company said.

Nevertheless, the company swung to a net profit of Rupee 5.50 billion ($75.46 million) for the quarter from a net loss of Rupee 5.39 billion the year before.

"The numbers indicate a fast recovery in the company's profitability, operational performance and a collective effort towards driving the full advantage of modernization and expansion," the company said.

But when tallied, the quarterly figure brought overall production from April, when India's financial year typically begins, until September, to 7.65 million mt, which is up 7.1% from 7.14 million mt.

By 2020 SAIL plans to lift production by 42.5% to 21.4 million mt/year from 15.02 million mt/year, and saleable steel by 43.6% to 20.2 million mt/year from 14.07 million mt/year.

In May, SAIL fired up its rebuilt blast furnace No.1 at its Rourkela steel plant with production capacity of 1.015 million mt/year versus 438,000 mt/year previously.

The Rourkela plant has a production capacity of 4.2 million mt/year of crude steel against 3.22 million mt/year previously.

In June, SAIL increased the production capacity of its Bhilai steel plant to 7.0 million mt/year of crude steel versus 4.07 million mt/year. But on October 9, the plant was struck by an explosion that claimed the lives of 12 employees. The ministry of steel and SAIL set up bodies to investigate the explosion.

Altogether, the production capacity increases will boost SAIL's requirements for raw materials.

In financial year 2017, hot metal production of 15.98 million mt/year consumed 25.87 million mt/year of iron ore. After expansion, 39 million mt/year of iron ore will be needed to make 23.46 million mt/year of hot metal, about 50.7% more iron ore.

"The capacity of existing mines at Kiriburu, Meghahatuburu, Bolani and Gua are being ramped up to meet the requirement of iron ore for the ongoing phase of expansion," the steelmaker said.

Coking coal requirements are expected to rise to 19.5 million mt/year post expansion, up 26.7% from 15.39 million mt/year.