Reacting to reports that the government is considering a short-term ban on exports of iron ore from India, the Federation of Indian Mineral Industries (FIMI), the representative body of miners, said that steel producers were raising artificial concerns of a scarcity of raw material for their vested interest.
In a communication submitted to Indian steel minister Dharmendra Pradhan, FIMI said that the so-called scarcity of raw material was ‘an artificial one’ as most primary steel producers had captive iron ore mines.
Citing the example of state-run Steel Authority of India Limited (SAIL), FIMI pointed out that, not only did the steel producer have its own captive mines, but it had recently offered one million mt of iron ore for commercial sale, indicating the availability of a surplus.
“It is rather intriguing and surprising that steel producers are raising a hue and cry over shortage of iron ore. In fact, all primary steel producers have their own captive iron ore mines and have an advantage in terms of quantum of raw material available as well as price. But on the contrary of passing on the benefits of lower input costs, domestic steel producers are inflating steel prices and making windfall profits,” FIMI said in its communication to the steel ministry.
It said that miners are only exporting iron ore not used by domestic steel producers. FIMI said that, of the total iron ore exports of 19 million mt in the April-September period this year, as much as 16 million mt had Fe content less than 58 per cent, which was not consumed by domestic steel mills.