Following the footsteps of Karnataka, the Orissa government is mulling to formulate a policy that will enforce curbs on iron ore and chrome ore exports by private miners from the state.
The move comes close on the heels of a similar restriction on iron ore and chrome ore exports by the state owned Orissa Mining Corporation (OMC).
For private miners, the state government plans to reserve 60 per cent of their iron ore and chrome ore produce for the industrial units in the state while allowing them to export the remaining 40 per cent.
"The state government has decided to impose curbs on iron ore and chrome ore exports by the private miners. We are mulling to come out with a policy according to which the private miners can export a maximum of 40 per cent of iron ore and chrome ore produce and reserve 60 per cent for the local industrial units. The state government will soon write to the Centre in this connection”, said Raghunath Mohanty, minister for industries and steel & mines, Orissa government.
The move is aimed at ensuring long-term raw material security for the industries in the state.
Earlier this month, the state government had announced that 70 per cent of the iron ore produced by OMC will be made available for the industries operating in the state. The company will be allowed to export balance 30 per cent.
The decision was taken at a high-level meeting where emphasis was laid on scaling up iron ore and chrome ore production of OMC. Accordingly, the corporation has been asked to come out with a 20-year Perspective Plan.
Presently, the iron ore requirement of the state is around 20 million tonnes per annum and OMC meets 15-20 per cent of the demand. It may be noted that a three-member committee consisting of the secretaries of the departments of steel & mines, industries and commerce & transport was constituted in November last year to look into the problems of the industries operating at the Kalinha Nagar Industrial Complex in Jajpur district.
The committee was constituted after Kalinga Nagar Industries Association (KNIA) complained of problems like inadequate availability of raw materials, high ore prices and high cost of transportation of ores. The association had pointed out that due to the prohibitive price of ore, the units have become commercially unviable.
"Two out of 11 industrial units operating at the KNIC have already been shut and the remaining units are operating at 30-50 per cent capacity. To ensure that the units run their operations normally, iron ore pricing and logistics pricing have to be streamlined”, said P L Kandoi, president of KNIA.
KNIA had suggested that the Orissa Mining Corporation (OMC) can supply 50 per cent of the ore to these industries at this fixed price and offer the balance through the e-auction mode. OMC can work out a base price of the ore based on production cost and after providing for its own margin, it had pointed out.
It said, prices of iron ore in the Gandhamardhan sector have surged by 191 per cent while in the Daitari sector, there has been an upswing of 130 per cent in iron ore prices in the past 12 months. For the third quarter of 2010-11, the price of OMC’s iron ore (size 10-40 mm) from Gandhamardhan is fixed at Rs 4155 per tonne and from Daitari at Rs 4455 per tonne.
The prices of ore from these two mines for the same period of 2009-10, were Rs 1426 per tonne and Rs 1944 per tonne respectively.
