Paradip Port Trust (PPT) has decided to conduct auctions for iron ore plots inside the harbour area as per a High Court order. The port authority has already intimated mineral traders and exporters about the decision and has asked them to vacate their plot areas by September 5.
“We have given them a 15-day notice period to vacate their plots. There are about 600,000 tonne iron ore fines stacked at the plots currently. If they fail to vacate within stipulated time, we might extend the period for some more time,” said Saroj Mishra, traffic manager of PPT.
Plots are allotted areas within the premises of port harbour, where different cargos are stacked for shipments. The recent HC order is meant only for iron ore plots, said Mishra.
As per traditional practice, iron ore plots were allotted to mineral traders and miners at fixed costs and their licenses for the plots were renewed every year with an increase of five per cent of base price. The dispute arose when an iron ore plot holder Auroglobal Comtrade Private Limited discovered that the port management has adopted arbitrary practice in fixing the prices of the plot.
The company had alleged that some firms had been given plots for Rs 90 per square foot while it was asked to pay Rs 459 per square foot .
The High Court, in its order, said, the discriminatory practices adopted by PPT are unlawful. It said, PPT must adopt transparent and open practices and must invite tenders to allot the plots.
Paradip port has 35 iron ore plots in total, out of which, 15 have mechanical lifting facility while in the rest plots, cargos are handled manually. In the upcoming auction process, the reserve price for manual plots is fixed at Rs 17.20 lakh. For mechanical plots it is Rs 51.60 lakh. The plots are sized between 3,000 square feet to 5,500 square feet.
Miners, however, opposed the move initiated by the port saying that it would put further margin pressure on the iron ore fines export trade, which is already reeling under poor demand and falling prices. “In the fresh auction process, there is a possibility that the mineral traders and export brokers would bid higher to get the plots. Hence, the miners will be bound to sell iron ore to traders at a lower price than export rates,” said R L Mohanty, president of East Zone Miners’ Association.