Steel mills located in eastern state of Odisha has expressed concern over rising shortage of iron ore faced by the mills and partially attributing it to low production from state government’s mining arm, Odisha Mining Corporation (OMC), Kalinganagar Industries Association (KNIA), an industry representative body said on Wednesday, June 23.
The Association said that iron ore mills in Odisha without having any captive iron ore mines were predominantly dependant on OMC for sourcing their raw material requirements and with the latter reporting lower production and mines recently auctioned by the state government yet to commence production had aggravated availability.
Citing data, it was pointed out that iron ore production in Odisha was 142 million mt in 2019-20 and fell to 111 million mt in 2020-21. Even as production in the state was falling, exports during 2019-20 was 17.4 million mt and rising to 29 million mt in 2020-21 resulting in domestic availability getting squeezed by 42 million mt.
As a fallout, price of iron ore in Odisha increased from INR 2,200/mt ($30/mt) in June 2020 to INR 12,000/mt ($162) in June 2021.
Falling production from mines of OMC had aggravated shortage faced by steel mills without any captive mines. Of the production of 111 million mt in Odisha during 2020-21, mines of OMC had produced only 13 million mt. This compared to captive mines owned by Tata Steel, SAIL, JSW Limited and JSPL producing about 65 million mt.