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Odisha based steel mills pleads for fair pricing of iron ore
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Friday, 04 Jan 2013

Business Standard reported that the All Odisha Steel Federation, an association of secondary and finished steel makers, has urged the ministerial panel on raw material supply to address issues pertaining to pricing and availability of minerals ahead of the next meeting of the committee.

It said that though the recent state government notification to reserve half of the iron ore output for local units was beneficial for the industry, the mine owners were deliberately quoting higher rates.

Mr PL Kandoi president of the AOSF said that “After this notification, the mine owners have informed about the availability of ore for the steel units through media and letters to Kalinga Nagar Association and AOSF. They are intentionally quoting such a high rates that the industry can’t afford to buy the raw material.”

Mr Kandoi said that “they are doing so with an intention to prove that the decision to allocate 50% iron ore for state based units is not workable, so that they can build up an argument to force the government to either cancel the order or modify it with a toned down ore quota for domestic industries.”

Mr Kandoi added that “The purpose of the notification will be achieved when a fair price mechanism is implemented.”

The steel makers have been demanding that miners must lower rates as the current market prices are about 10 times higher than cost of production of the mineral.

The mine owners, however, refuted the charges saying the rates are always determined by supply and demand. Mr Rajiv Lochan Mohanty, president of Eastern Zone Miners' Association, said that “There is no question of cartelisation since many industries based outside Odisha are buying iron ore at the prevailing market price and still making profit. If a domestic steel maker wants, he can always negotiate with the miner on price.”

Source - Business Standard


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