Business Standard reported that according to the Sponge Iron Manufacturers Association, the recent clamp down on miners by the Odisha government is likely to affect India’s sponge iron production by around 15% in the current financial year.
Mr Deependra Kashiva ED of SIMA said that “Since Odisha is the largest producer of iron ore and sponge iron, the recent measures taken by the state government will surely impact on sponge iron output. In 2011-12, the output was around 20 million tonnes. We expect this to drop by 15% in 2012-13.”
Government data said that between 2010-11 and 2011-12, iron ore output in Odisha declined from 73 million tonne to 60 million tonne, provisional. In the current financial year, the output is likely to drop heavily because of the recent order.
Mr RL Mohanty chairman of the Eastern Zone Miners Association said that “The decision to halt the mining activity till the processing of lease renewal in Joda and Koira mining circles will wipe out 20 million tonne to 22 million tonne annual iron ore output of Odisha.”
There are about 146 sponge iron plants and 29 partially commissioned integrated steel plants in the state, all of which depend upon iron ore supplies from the Joda and Koira circles which account for a fourth of India’s total annual production. Due to shortage of locally produced iron ore, several sponge iron units are currently running at just 25% capacities since the last few months, while many smaller plants have shut shop.
