JSW Steel cuts output by a third on account of iron ore shortage — Economic…

27 Апр 2015 | Author: | Комментарии к записи JSW Steel cuts output by a third on account of iron ore shortage — Economic… отключены
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JSW Steel cuts output by a on account of iron ore shortage

MUMBAI: An acute shortage of ore in Karnataka and exorbitant auction have forced India’s steelmaker JSW Steel to cut production by a third and threatens to shutter manufacturing across the region. than 70 sponge iron in Bellary have shut already, leaving around people jobless, people with the industry say.

decision to cut output has impacted key industries such as auto and where supplies have by about 40%, according to from steel mills are contracted to sell to carmakers. The Court in July ordered of iron ore mining in Karnataka a submission by a court-appointed panel on mining in the region.

While the ban has cut iron ore supplies, it has pushed prices higher in auctions of the commodity. It’s a now, says JSW vice Sajjan Jindal. There’s no ore, prices of those are available are too high.

The suspension (of should have been separately and in a phased manner. all mining districts under the ban has led to acute shortage, he added.

Struggling to cope with the the Karnataka government initiated an of seized iron ore amounting to 25 tones, but instead of meeting mill requirements. it has made costlier and production unviable. It has thrown sponge iron in disarray. Sponge iron or secondary steel mills, about 5 million tonnes a — almost half of JSW makes in a year — and are the for industrial furnaces and automobile and industries.

While these units about 35,000 people around 200,000 depend on units indirectly. The units particularly affected by the high price which was 75% more the market price. During the round of eauction on September 14, of low grade fines was Rs 2,700 a compared to Rs 1,200 in the open

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Higher grade ore, widely by the sponge iron have been priced at Rs a tonne. The high prices led to the lot of 104,000 tonnes of low grade ore fines to remain unsold as were no takers. The high prices kept the smaller out, said Karnataka Iron Association president Rao.

Also. for a sector that key inputs for the user industries, we not been awarded any mining neither any land. The auto has taken a big knock in this and are staring at a drop in demand due to interest rates. Nitin CFO of Bhushan Steel. a major to carmakers like Honda, Motors.

Maruti and Hyundai, sales to the industry has fallen by 15-20 %. Agrees Ankit director at Uttam Galva, large supplier to car companies. supplies to the auto industry fallen by about 40%.

Tough Times

Supreme in July ordered suspension of ore mining in Karnataka following a by a court-appointed panel on illegal in the region While the ban has cut iron ore it has also pushed prices in state-conducted auctions of the commodity decision to cut output has impacted key industries such as auto and where supplies have by about 40%.

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