Keonjhar Industries Federation (KIF), the industry body representing about 30 iron ore crushing units employing about 40,000 people, has sought iron ore lumps at lower prices to continue their operation.
They have also requested the state government and the Orissa Mining Corporation (OMC) to have long term supply arrangement with the small scale units in Keonjhar district.
“We have submitted a memorandum to the chairman-managing director (CMD), Orissa Mining Corporation, to have a long term supply agreement with the 30 odd crushers operating in the district and to allot different grades of iron ore lumps in 63 percent, 65 percent and 66.5 percent Fe category. However, OMC is yet to take any decision”, Suresh Patnaik, president, KIF said.
Addressing the media here, he said, these units have invested about Rs 300 crore and provided employment to about 40,000 persons in the district. He alleged that instead of protecting the interest of the small scale units, the government was only protecting the interest of the big investors.
Since, the total requirement of these small scale units are only 10 to 15 percent of the production in Gandhamardan mines region under OMC, it will not affect the business of the state-owned mining company.
Soumya Patnaik, an executive member of KIF, said, OMC has fixed the price of lumps having 66.5 percent Fe content at Rs 1739. Add to it, the payments towards royalty, VAT, entry tax, transportation and processing costs, the final price works out to Rs 3546 per tonne of sized ore (CLO). However, since OMC has fixed the price of the 5-18 mm CLO having 65 percent Fe content at Rs 2639, the crushing units are making a loss of Rs 907 per tonne. This has rendered these units unviable, Patmaik said.
In this context, the federation demanded that the OMC should supply lump ore with 66.5 percent Fe content at Rs 1248 per tonne instead of Rs 1739.
He said, OMC invites tender for lumps having 66.5 percent Fe content, which is a soft material and not suitable for the sponge iron factory. So OMC should allot all grades of available lumps enabling blending by the crushers to make it more suitable for the market.
The federation is expected to discuss the issue with the senior officials of the state steel and mines department today and with the Keonjhar collector tomorrow. If the government fails to heed to the demand of the federation, then they will be forced to resort to agitation, Patnaik warned.
