SC panel refuses to direct NMDC to reduce iron ore prices

The Central Empowered Committee refused to issue directions to ore producers on producing a certain type, beneficial to industries like sponge iron

The Supreme Court-appointed Central Empowered Committee (CEC) today refused to intervene in matters pertaining to the pricing of iron ore put on e-auction. It also refused to issue directions to ore producers on producing a certain type, beneficial to industries like sponge iron.

Responding to a plea from Karnataka-based sponge iron manufacturers for directing NMDC to reduce the price of lumpy ore sold through e-auction in Karnataka, the CEC said, "We will not intervene in the internal issues of NMDC, nor enforce anything on anybody. We do not understand the market dynamics and we have no mandate to direct them on bringing down the prices."

At a meeting with the ore producers, steel and sponge iron manufacturers in the presence of officials of department of mines and geology, here, the CEC team clarified they were not responsible for fixing the prices and could not direct the miners to reduce prices, sources said.

The representatives of Karnataka Sponge Iron Manufacturers Association (KSIMA), present at the meeting, requested for directing NMDC to produce lumpy ore with certain sizes. They also wanted the prices to be reduced.

The CEC had directed the KSIMA representatives to give the details of the ore procured through legal sources before the imposition of the ban on mining in Karnataka, so they could study the matter.

Currently, of the 70 sponge iron units in Karnataka, 50 are closed due to the high cost ore. The rest are running partially.

The steel industry representatives also appealed to the CEC for intervention in the e-auction procedure and to direct NMDC to reduce the prices for lumps unsold in the last several rounds of e-auction.

About two to three million tonnes of lumps put on e-auction by the NMDC remain unsold in the last few months. It is estimated NMDC has 1.4 million tonnes of lumpy ore.

As regards the renewal of mining leases, expired recently, the CEC said it would look into the details, case by case, and fast-track the process. It also directed the Monitoring Committee to release 90 per cent of the ore sold at e-auctions to miners directly.