India’s ministry of steel has completed consultations with major industry stakeholders to address the low capacity utilization of domestic iron ore pellet plants, a government official said on Tuesday, October 21.
According to the official, the discussions aimed to tackle the persistently low 60-65 percent utilization levels across the country’s pellet-making facilities. The consultation involved leading steel and mining companies, including Steel Authority of India Limited (SAIL), JSW Steel, Jindal Steel, ArcelorMittal Nippon Steel India, Rungta Mines, and KIOCL Limited.
Industry seeks fiscal support and policy clarity
The consultation focused on several key issues such as the unviability of iron ore fines beneficiation, challenges in tailings disposal, and the impact of pellet imports on domestic plant utilization. Industry representatives emphasized that declaring an Average Sale Price (ASP) for low-grade ore with Fe content below 45 percent would help improve competitiveness. They also suggested introducing an export tax on iron ore fines with Fe content under 58 percent, along with tax incentives on imported beneficiation equipment to reduce capital costs.
Further recommendations included simplifying land clearances for tailings disposal, excluding tailings and residues from mine capacity limits, and offering a five percent royalty incentive for beneficiated ore. The industry also called for the rationalization of Odisha’s royalty regime and the creation of a mechanism to discourage pellet imports, which have been limiting domestic plant utilization.
Following the consultations, the ministry of steel is expected to prepare a comprehensive policy framework based on the industry’s feedback and forward it to the ministry of mines, which holds the final authority over policymaking in the iron ore and pellet sector, the official said.