The Karnataka Iron and Steel Manufacturers? Association (KISMA) has urged the Supreme Court-appointed Central Empowered Committee (CEC) to control artificially inflated iron ore prices in the state.
This is a part of the four-point agenda of demands put forth by the steel manufacturers? body in the state which is sitting on a 10-12 million tonne per annum (mtpa) shortage of iron ore to hit the steel making companies in the state in FY14 and FY15. ?
In a list of demands sent to CEC, KISMA pointed out that apart from the shortage, it is an issue of ?artificial inflation? which is taking a toll on the steel companies.
He said the first important aspect of the pricing issue is that the base price of iron ore fixed for e-auctions is being fixed artificially at a much higher level than in any other state compared with Orissa and Chhattisgarh.
However, a top official in the monitoring committee, responsible for holding the e-auctions, maintained the base price is fixed at the price at which NMDC sells.
?The price of ore is fixed at NMDC?s base price and the premiums on e-auctions have also gone by 25-30% in last two of three auctions. Most of the times the price is realistic,? the official said.
The other demands put forth by the steel manufacturers? association are that of restarting of closed mines and increasing the permissible limit of the category A and B mines temporarily, so that the 30 million tonne target could be reached.
This also includes increasing the limit of Mysore Minerals Limited (MML) ? a Karnataka state undertaking which is currently permitted to mine 1.2 million tonnes per annum (mtpa) against and Resettlement and Rehabilitation (R&R) approval for 4 mtpa.
The association has requested to allocate fresh resources as there are 166 mines still not explored and has the potential to substantially add to the 30 mtpa cap of mining when operational.
The association has requested CEC to allow early auctioning of category C mines, simultaneously carrying out the investigations on the extent of illegal mining and loss to the state exchequer is determined.