Indian stainless industry concern price fixation
Bhubanewar: India’s leading stainless steel producer Jindal stainless (JSL) has expressed its displeasure over the east Indian state Odisha government’s price fixation policy of chrome ore. The O.P.Jindal Company has alleged that the high and fluctuating price of Chrome ore has poised direct threat to the existence of ferroalloys industry in the state.
Well known Indian Industrialist and Vice-chairman and Managing director of JSL Ratan Jindal has termed the chrome ore price fixation policy of Orissa Mining Corporation (OMC) as horrendous. “It is the most horrendous policy the OMC is having. It is really pain to say that nobody seems to be concerned about the industry in Orissa. We are trying to convince the state government, but so far not much has been done as far as OMC’s pricing policy is concerned, due to which all the ferroalloys units in the state are bleeding and are in the ‘Intensive Care Unit’.”
“We have set up a plant in the state considering the abundance chrome ore availability here. The government has promised us and signed an MoU , a JV has been formed ,but no real breakthrough in all these issues has come in the last 7 years” He added.
With almost 97% of the total chromites reserve, Odisha is the leading chrome ore producer of the country. Apart from smaller units three major industrial units JSL, Rohit Ferrotech and Visa Industries have the capacity to consume almost 70 % of the chrome produced in the Sukinda south Kaliapani mines of the OMC, the major chrome reserve block of the state. But due to the high price of the crucial metal-ore these units are struggling to keep up the production with their actual capacity.
“The OMC is fixing price for the entire quarter considering the aggressive price bid by some smaller players from outside states. In the current quarter OMC has raised the Chrome ore price by 10% to around $ 306.71 per ton. However the landing price of the lumpy ore imported from Oman is around $ 191.69 per ton. So we are procuring only 3 to 4 thousand tones of the ore against our requirement of 40 thousand tons per month. On the other hand we have installed the large plant along with the technology suitable for the ore available in the state and we cannot completely use the imported chrome. So we are using the domestic chrome ore blended with the imported ore. But due to the high and fluctuating price of the OMC chrome, we had to shut down our blast furnace in the months of October, November and December last year” said Mr S.S.Virdi, Executive Director and COO of the JSL Kalinganagar plant.
It is learnt that Rohit Ferrotech has also stopped procuring chrome from OMC and start buying from private parties.
“We have been fighting for this for the last one year and filed a case in the Odisha High court under the all Orissa steel federation banner and the honorable high court has admitted our case a month back ” he informed.
A senior official from OMC on condition of anonymity has admitted that this is certainly an issue and the sale of chrome ore has been decreased significantly due to this and lower export. In the Current Quarter (January to March 2012) OMC is selling the 54% and above grade chrome ore at a price US$ 322.12.