Iron ore rich Orissa, for the first time since independence, imported ore from Karnataka. Two rakes of iron ore from in Karnataka?s Belary mines had been imported by sponge iron makers in the state.
?The government action following the allegation of mining scam has suddenly turned Orissa an iron ore starved zone,” said P L Khandoi, the president of Kalinga Nagar Industries Association(KNIA). Finding no way out, the industries, particularly located in Jharsuguda and Sundergarh districts, are now importing iron ore from Karnataka, he added.
?Calibrated lumpy ore (CLO) is hardly available in Orissa market and, if at all, it is being quoted at a high of Rs 3,300 per tonne. On the other hand, the landing cost of Belary ore is a little over Rs 1000 per tonne?.
Khandoi?s concern is that the steel plants located in Kalinga Nagar Industrial Complex in Jajpur district are not able to compete with their counter parts in Jharsuguda-Sundergarh because of the price differences in the raw materials.
?While the sponge iron units in Jharsuguda-Sundergarh are able to produce at a cost of Rs 13,000 per tonne, our cost of production comes to about Rs 16,000 per tonne,” he said.
In Kalinga Nagar Industrial Complex, about 10 steel units with a total capacity of 3 million tonnes per annum (MTPA) have gone into production. But, due to non-supply of iron ore, the units are now forced to scale down their production.
?The plants have come up on the promises by the state government that iron ore will be supplied to the industries from the nearby Daitary mines of the state-run Orissa Mining Corp(OMC),” said KNIA president. The OMC was supplying about 2 lakh tonnes of raw materials per month to these units. However, the OMC has stopped raising from the mines for the last six months on the ground that the mines need forest clearance, he added.
In fact, the OMC is scared of the prosecution by the state vigilance police which is now looking into the multi-crore mining scam in the state.
?We are running out of our stocks and, if there is no immediate supplies, we will be forced to shut down our plants,” said Khandoi.
?Sourcing iron ore from Joda-Barbil sector has become difficult as the landing cost is very high due to the whimsical rates quoted by truck operators,” Khandoi said, adding that some of the plants are exploring the possibility of importing iron ore from Karntaka.