The sponge iron industry in Karnataka is facing its worst ever raw material crises thanks to the restriction imposed on outflow of iron ore from the district.
While dried up iron ore supply has forced most of sponge iron plants to shut their production, others are running their units at less than half of their capacity and are totally dependent on iron ore auctioned by the government.
“Quality available during auction is not up to the mark, more over size varies in every lot.Auction prices are hovering around Rs 3500-3700/MT for Fe 58-60% for a size of 3-40mm iron ore.” said Mr Singhal, sponge manufacturer based at Bellary.
However, Considering that the delay in the transport of iron ore is affecting production, the Monitoring Committee in Karnataka has agreed to extend the timings for transportation of ore from the present 12 hours to 16 hours.
But according to the chief executive officer and director, JSW Steel Limited, “Unless the government allows transportation of the raw material round the clock, it would be difficult to maintain the production levels and we cannot shut down the furnaces”.
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