Chhattisgarh Sponge Units request 10 MnT Iron Ore Lump Reservation from NMDC

CGSIMA (Chhattisgarh Sponge Iron Manufacturer’s Association) requests the state government to reserve 10 MnT of Iron ore Lump to be used exclusively within the state. In addition, state government must have an active role in deciding Iron ore prices.

As of now, Iron ore situation in India is aggravating, as mining in various states is on a halt. Sensing the shortage and its ghastly effect on the Sponge manufacturing units in Chhattisgarh, CGSIMA suggested the state government to reserve about 10 MnT of Iron ore Lump by NMDC production ‘for the state only’.

NMDC produced about 20 MnT of Iron ore in Chhattisgarh’s Bailadila mines, of which just 5 MnT is reserved for consumption within the state. As per SteelMint’s railway report, on an average 75 rakes movement are tracked every month those supplies to Iron ore consumers within the state accounting for about 2.5-3 MnT of Iron ore. 

CGSIMA suggested reserving around 10 MnT of Iron ore Lump exclusively for the state’s consumption. This move becomes necessary for survival of dreaded Sponge industry based in Chhattisgarh.  Mr. Vijay Jhanwar, General Secretary, CGSIMA says, “There are about 80-90 Sponge iron units installed within the state, of which around 20 are closed. More importantly, it is disappointing to see how these 60-70 units are operating, with just about 50-60% operational capacity that is drabbing state’s potential.

Adequate availability of Iron ore is one way with which these units can revitalize. Therefore, reservation of about 10 MnT is one such workaround. In addition, the state government must have an active role in deciding prices of Iron ore, mined by NMDC in Chhattisgarh.”

On the other hand, NMDC stated that the company had increased quota for Chhattisgarh based mills from 2 MnT to 5 MnT in last couple of years. Unfortunately, companies have not been able to utilize their exiting limit owing to high prices of Iron ore from NMDC, for which CGSIMA has been continuously representing.

In FY14, India had produced 150 MnT of Iron ore, of which 60 MnT were used by companies which have captive mines for their own consumption. 13 MnT has been exported and the balance 77 MnT of Iron ore has been sold to domestic steel plants and Pellet plant without captive mines. NMDC controls around 40% of market share in the domestic steel market. 

NMDC Iron Ore Production

Quantity in MnT