India’s Orissa state slaps limits on iron ore production

The government of the mineral-rich eastern Indian state of Orissa has decided to gradually impose production curbs on iron ore mines without end-use facilities, senior government officials said on Wednesday, November 7.
 
"Production limits have already been imposed on mines operating in the Joda-Koira reserves and will be gradually extended to cover all iron ore mines in the state to limit annual iron ore production to 50 million mt," the official said.
 
"The government does not want to entertain non-captive mining of iron ore in the region. We want to seek iron ore linkages that will provide value addition following this policy to curb mining for merchant purposes," the official added.
 
The production curb also aims at monitoring widespread illegal mining and excess extraction of ore above that permitted by approved mining plans, officials said.
 
Orissa accounts for 34 percent of India's iron ore reserves of 28.52 billion mt and produces about 70-75 million mt of ore per year.
 
It may be noted that the M B Shah Commission appointed by India's Supreme Court is currently investigating illegal mining in Orissa as part of its mandate to investigate all illegal mining activities in the country. Mining activities have already been banned in the states of Goa and Karnataka in the wake of these investigations.
 
As a result, India's iron ore production was down 19.65 percent in the financial year 2011-12 at 167.11 million mt, compared to 207.99 million mt in the previous financial year. In the same period, iron ore exports were down 41.78 percent at 57 million mt, compared to 97.90 million mt in the previous financial year.
 
In the financial year 2012-13, Indian iron ore production is anticipated to fall further to 140 million mt.
 
According to a private mine operator in Orissa, the annual production limits could bring down India's exportable iron ore by about 20-25 million mt since no ore for export is being extracted from other iron ore reserves in Goa and Karnataka.