MMTC had convened a meeting of the chrome ore producers last week (April 19) at Delhi to discuss about the problems being faced in the selling the friable chrome ore in the global market. The two major chrome ore producers -- Orissa Mining Corporation (OMC) and Tisco -- attended the meeting besides the Industrial Development Corporation (IDC) and Mishrilal Jain & Company. The four mining companies, who are trading with chrome ore, have their mines in Orissa which has about 98 per cent of the chrome ore reserve in the country.

MMTC officials told there is no demand for the ore due to depressed market conditions. The availability ofconcentrate in the market has further reduced the demand for ore, they pointed out and submitted that unless there is a price rationalisation between the concentrate and friable ores it would be very difficult to sell the latter in the market. They said that the buyers could be motivated to take friable ore if it would be offered along with concentrate as a package.

The meeting decided to empower MMTC to rationalise ore prices by allowing the trading house the flexibility of five per cent margin to negotiate with the buyers. About the supply of concentrate to be offered as a package to the buyers of friable ores, it was decided that the two major concentrate producers, OMC and Tisco would jointly take a decision on the proposal.

MMTC, the sole canalised agent in the country for friable chrome ore, was under tremendous pressure from the ore producers as there was less take off of the mineral in 1998-99. While OMC was able to export 33,189 tonnes of friable chrome ore, Tisco sold about 62,000 tonnes in thelast fiscal.

Interestingly, both the ore producers have sold more concentrate during the year than friable ore. While OMC has exported 72,000 tonnes, Tisco has sold about two lakh tonnes. Concentrate being a decanalised item, the producers are selling the ore directly in the international market.

According to market experts, the buyers are preferring concentrate to friable ore as the former is cheaper. While the international price of 52-50 grade friable ore is being quoted at $74 per DMT (dry metric tonne), the same grade concentrate is available at $69. Similarly, 50-48 grade concentrate is available at $60 while the friable ore is being quoted at $69. They also pointed out that quality wise there is wasn't much difference between the friable ore and concentrate.

Stating that friable ore is being smuggled out as concentrate by the small time beneficiary companies, the market experts said that this is also one of the reason why the buyers prefer concentrate than friable ore. For, they would get friableore at concentrate rate, the experts elaborated.

The market experts are of the opinion that the chrome ore market would remain depressed for some more time.

As there is no demand for the end products like stainless steel, the ferro alloys manufacturers world over are saddled with huge inventories. This has resulted in slump in demand for the chrome ore, they said.