For the
last several years the All Odisha Steel Federation (AOSF) is fighting a battle
with the Odisha Mining Corporation (OMC) for raw material linkage. The federation
representing the steel, ferrochrome and sponge iron units at KalingaNagar Industrial
Complex and other steel units in the state has already taken up the raw
material issue with the Competition Commission of India (CCI). In a conversation with Tapan Moharana, Mr.
Purusottam L. Kandoi, President, AOSF expressed that the purely commercial
attitude of OMC is responsible for the crisis.
Q. For a long time, the
member units of All Orissa Steel Federation have been struggling with non
availability of raw material. Has there any improvement?
There are two scenarios in Odisha. One, those who have mines, but do not have any industry. Another is
those who have industry but do not have mines. Our case is the second one. We
have steel plants but do not have any mines or any long term iron ore linkage.
Like a human being needs food for living, without it the consequence
is starvation death, steel Industry needs raw material like iron ore, without it,
we have to close down. Private miners selling iron ore with 1000% profit in the
open market and the attitude of the government miner, Odisha Mining Corporation
(OMC) is also purely commercial and arbitrary. How can we compete with the
plants with captive mines? So there is no end to our crisis so far.
Q.What is your take on the
new resolution of the Odisha Government on mining?
The new resolution has laid focus on captive consumption of minerals
and the government is to bring back the stand alone mines to its possession. It
is a good sign as it’ll remove the imbalance to certain extent and the share of
private miners will be reduced. But the suffering of the steel industry will go
on, because all these mines will go to the fold of the inefficient government miner
OMC. So government should allot some
mines to the industries that are in need.
Q.Are factors like scarcity
of iron ore and high power tariff affecting the cost of production of your
member steel units?
Simply
we cannot compete with companies like Tata and others who have captive mines.
Private miners are selling iron ore 10 times more than the raising cost. So our
cost of production is very high due to expensive iron ore and high power
tariff. But at the same time we cannot sale steel beyond certain price limit
(say Rs. 40,000 per tonne). The only way is to cut or stop production.
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