Govt yet to work out iron ore pricing mechanism; firms want benchmarking

While the ministry of mines favours a benchmarked price, the ministry of steel vehemently opposes such a move

The Union government has dropped the proposal to cap iron ore prices but is yet to derive a pricing mechanism for the raw material. Some of the mining companies are pitching for a benchmark price for the raw material on the lines of oil and coal.

The pricing of iron ore has to be based on global parity and local demand and supply situation. The pricing of the end-product is market driven, according to a mining company official who does not wish to be quoted.

The ministry of mines and the ministry of steel are at loggerheads over the issue,