FIMI seeks Karnataka government support for sales of iron ore outside state

Thursday, 22 October 2020 17:49:34 (GMT+3)   |   Kolkata

The Federation of Indian Mineral Industries (FIMI), the apex body of miners in India, has asked the government of the southern state of Karnataka to support its petition at the Supreme Court seeking permission for miners in the region to sell iron ore outside the state, a FIMI official said on Thursday, October 22.

The official said that iron ore inventories of miners in Karnataka are rising steadily, while at the same time steel mills in the state are procuring raw materials from outside the state and local miners are forced to offer their production for e-auction sales only to steel mills located in the state.

In January this year, the Supreme Court increased the maximum ceiling for iron ore production in Karnataka from 30 million mt per year to 35 million mt per year but subject to conditions that miners would only be able to sell to steel mills located in the state through government-conducted e-auctions.

FIMI has filed a petition before the Supreme Court seeking permission to either sell iron ore to steel mills across the country or to enter the export markets. The court in preliminary hearings had directed the Karnataka government to file an affidavit stating its stand on the issue.

FIMI stated that export-import policies are governed by the federal government and that the Karnataka government is the only state that has a different policy. “If steel companies can buy iron ore from outside the state, why can Karnataka miners not be able to sell their production outside the state?” it queried.

According to it, the annual demand for iron ore from steel mills in Karnataka is estimated at 33 million mt, while the current level of production is around 37 million mt per year, leaving a surplus of 4 million mt per year.

Under the surplus conditions in the market, the Karnataka government should support FIMI’s petition before the apex court, the miners’ body said.

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