Indian steel mills have petitioned the government of the Indian state of Odisha seeking fair collection of royalty rates and a reduction in the iron ore prices charged by local miners, a government official said on Thursday, January 28.
The official stated that the steel mills represented by the Indian Chamber of Commerce (ICC) claim that local iron ore miners are factoring into their prices the royalty rate applicable for the highest grade of ore found in their respective mines instead of the grade of ore for which they are actually charging, which in turn pushes up the prices of raw material supplied to the steel mills.
It has been pointed out by the ICC, which represents a number of steel mills located in eastern India that mills are being charged in the range of INR 1,000-1,800/mt ($15-27/mt) for low grade ore and, since many of the medium-sized mills do not have the financial resources to pay for import raw material, they are forced to reduce the capacity utilization of their plants, the Odisha government official said, citing the representation made by the ICC.