Steel and sponge iron makers of Karnataka alleged that NMDC was not producing iron ore at the permitted levels of 12 million tonne per annum and it was operating at less than half the threshold.
Sponge iron and steel companies are facing severe shortage of iron ore because of ban on iron ore mining in Karnataka.
These companies largely stayed away from the two recent e-auctions of ore by NMDC citing high prices. The two auctions got less than 7 percent offtake, reports suggest.
The companies allege that NMDC ignored international market rates and is charging higher prices, making things difficult for the consumers of ore.
Reports indicate that steel and sponge iron makers want NMDC, which is the only miner allowed to operate in Karnataka, to augment production and lower prices.
The industry that constitutes nearly a fourth of all
steel produced in India is grappling with high operating costs that has seen 37 units shut shop this year. The average rate of utilisation inside the mills is just 50 percent.
Seshagiri Rao, Joint Managing Director of JSW Steel said there are 37 units which are closed. Some of the units that have not closed down are operating at less than 25 percent capacity, he added.
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