Iron ore mining companies in Odisha charge exorbitant rates while selling ore to local steel firms, alleges the All Odisha Steel Federation (AOSF).
The body, which represents the interests of local steel units and sponge iron manufacturers, alleges that two mining lessees- Sirajuddin and Indrani Patnaik had offered ore for sale to such steel units at high prices.
While Sirajuddin had offered 250,000 tonne of iron ore for sale to local units in December 2012, Indrani Patnaik offered 165,000 tonne. The sale price of both the lessees stood at Rs 5,600 per tonne against their raising cost of Rs 600.
According to AOSF, Sirajuddin and Indrani Patnaik are raking in monthly profit of Rs 125 crore and Rs 82.5 crore respectively at this sale price.
AOSF alleges that each miner is earning Rs 200 crore per month at these rates. It argues that these mine owners are exploiting the steel units for the past 3-4 years. They are intentionally quoting such a high rate that the local industries cannot afford.
AOSF blames the practice of offering negligible quantity in tenders of Odisha Mining Corporation (OMC) for the unrealistic high prices. The defective price discovery mechanism of OMC is fixing high benchmark prices for mine owners, AOSF argues.
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