An agency report quoted Basant Poddar, Vice President of Federation of Indian Mineral Industries (FIMI) as saying that the use of low-grade iron ore by steel firms may raise the operational cost of these firms.
On the back of acute shortage of iron ore in the country, steel firms are forced to use low-grade ore to run reasonable capacity, he reportedly said. The use of such ore raises operational cost owing to higher power consumption.
Steel firms are facing shortage of ore because mining in Karnataka, Goa, which are leading producing states of the raw material, is restricted by the Supreme Court. High-grade ore is unavailable due to halting of mining operations in many producing regions.
The apex court completely banned mining in the ecologically sensitive state of Goa, which is also the largest producer of low-grade ore in the country.
Following the halting of mining in many other states like Karnataka and Odisha, availability has become an issue, FIMI said.
Earlier, while high-grade ore was used by the domestic industry to produce steel, low-grade ore was exported to other countries, especially China.
Poddar, however, said it would be better for steel plants to blend low-grade with high-grade iron ore for better use of the resource.