Disappointed with the lukewarm response to 50:50 clause from steel units, the Odisha government has indicated that it may revoke the order in the coming months if situation continues like this.
“For the last several months, we have witnessed that the steel plants are not lifting their allocated amount. While, 50% of iron ore production has been reserved for the local industries and they are lifting only half (or even less) of the earmarked amount. If the situation continues like this, we’ll have no option but rethink about the order”, a senior official in the Odisha Directorate of Mines said.
He added that the department has convened a review meeting on 11th of this month to take stock of the situation. The government has asked the miners to increase production in the current financial year. In the last financial year (FY15), odisha had produced 47.5 MnT of iron ore.
On the other hand, steelmakers have complained about the high price and low quality of materials they have been offered because of not lifting the amount.
In current scenario, Serajuddin Mines has reduced its Fe 63% lump prices to INR 3,550/MT ex-mines. Earlier, the allotted price by the state government was INR 4,150/MT ex-mines for Serajuddin and INR 2,000/MT (Fe 60-62%) for S N Mohanty mines in Q1 FY16. However, current prices for iron ore offered by the S N Mohanty mines are INR 2,850/MT ex-mines.
Current & Recommended Prices for Iron Ore Mines
| Mines | Grade (Fe%) | Size (mm) | Recommended Prices by Government |
Current Market Prices |
| Serajuddin Mines | 63 | 5-18 | 4,150 | 3,550 |
| Indrani Patnaik | 62 | 5-18 | 4,150 | 3,650 |
| S.N. Mohanty | 60-62 | 5-18 | 2,000 | 2,850 |
Prices in INR/MT
Allotted & current prices on ex-mines basis
Source: SteelMint Research
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