Visa Steel row over fines procurement resolved

The state government has finally permitted Visa Steel to procure iron ore fines upto 10 mm size for conversion into sinter after a delay of three months.

"Finally after running three months from pillar to posts, the mines secretary understood our plea and asked the local DDMs (deputy director of mines) to take care of our demand," said an official of Visa Steel, which has a 500,000 tonne per year steel rolling mill at Kalinganagar in Jajpur district.

In April this year, Visa Steel had entered into an agreement with Neelachal Ispat Nigam Limited (NINL) for converting iron ore fines into sinter, which will be processed at Visa Steel blast furnace for making steel.

However, since Visa Steel engaged a third party to process the fines, the local DDMs of Jajpur Road, Joda and Keonjhar objected to the fines procurement of larger size and permitted the company to buy fines only up to 5 mm.

"The DDMs apprehended that we will be selling it to outside parties because there is lack of availability of sized ore in the market. So we had to convince them that we are the end-user of the sinter as per our agreement with NINL apart from the fact that sinter plants cannot process fines of less than 5 mm size," said the company official.

The agreement says that NINL will provide 20,000 tonne of sinter every month in exchange of iron ore fines provided by Visa Steel procured from private and government-controlled mines. NINL will charge Rs 2,450 per tonne for conversion of fines into sinter.

The company also cited the example that in case of other steel plants having own sinter processing facility, the DDMs have allowed fines procurement of 10 mm size, but just because Visa appointed a third party, the officials raised objections.

"The issues seem resolved now. We have already procured one rake fines from Joda. Orders from DDMs of Jajpur Road and Keonjhar will be received shortly," the official said.

Sinters are processed out of iron ore fines and can be directly used in blast furnace for production of steel. Many steel plants are switching to use of sinter in blast furnaces these days because of unavailability of sized iron ore.