At a time when the steel industry is keeping its fingers crossed on further rise in domestic iron ore prices, which may impact their margins, Jindal Steel and Power Ltd (JSPL) chairman Naveen Jindal on Friday sought urgent intervention of the Odisha government over operational problems faced by its plants due to shortage of coal and higher iron-ore prices.
“The abnormal high prices of coal and iron ore in Odisha despite a sharp drop in the rates in the international market has added to the woes of steel companies,” said Jindal. Also, the transporters are increasing the freight rate from time to time. This adds to the challenges faced by the steel industries in the state, he said after meeting with chief secretary AP Padhi.
Jindal urged the state government to initiate steps to increase iron ore availability for industries in competitive price and implement the notification regarding freight rate for mineral transport in the state.
This apart, there is an acute scarcity of coal in the state. “In Odisha, we’re buying the world’s costliest coal through e-auction. Thus, MCL and Coal India have to increase coal production,” Jindal said, adding the premium for coal in e-auction by Mandi Coalfields Limited goes up to 100 per cent.
The consistent rise in raw material costs has vexed the steel industries as prices of finished steel products were declining, said Jindal. During April to July, Jindal said, “Steel prices have been reduced from Rs 41,000 per tonne to Rs 39,000 per tonne, whereas prices of iron ore lumps has surged by 10.58 per cent from Rs 4,725 per tonne to Rs 5,225 per tonne and fines by 17 per cent from Rs 2,050 to Rs 2,400 per tonne.”
The steelmaker has so far invested Rs 35,000 crore in the steel sector in the state, which includes India’s largest pelletisation complex of 9 MTPA capacity at Barbil in Keonjhar district and Odisha’s largest steel plant of 6 MTPA capacity. (PTI)