Steel units facing iron ore shortage

Steel industries in Odisha have urged the State government to bail them out from the high price of raw materials including iron ore. Iron ore production in Odisha has dropped by over 31 million tonnes from 142 million tonnes in 2019-20 to 111 million tonnes in the 2020-21 financial year, according to official data. Due to less production and increase in exports, the local industries have to pay around Rs 10,000 per tonne of iron ore in comparison to Rs 2,200 per MT in June last year.

They claimed that due to an unprecedented increase in the price of the iron ore, many of the units had become unviable or on the verge of closure. Industry bodies like the Orissa Sponge Iron Manufacturers' Association and the Kalinga Nagar Industries Association have already taken up the matter with Chief Minister Naveen Patnaik, chief secretary and the Steel and Mines secretary to keep iron ore prices at a reasonable level so that iron and steel industries in the State could survive and make some margin.

"There should be a hike in the production of iron ore. Secondly, captive miners should not take part in the auction process," Kalinga Nagar Industries Association president P L Kandoi said. He said there should be a special provision for fair price of iron ore for the LTL (less than truckload) buyers so that iron and steel industries in the State can survive and make some margin. Odisha Sponge Iron Manufacturing Association president Yogesh Dalmia also opposed the current auction process, saying that the auction of iron ore by the state-owned OMC should be made on a monthly and not bi-monthly basis. Despite the auction, 80 per cent of the iron ore should be reserved for Odisha-based industries, Dalmia said.