Ballari: The state, which has already been dealt a blow by global giant, ArcellorMittal’s decision to withdraw its proposal to set up a steel plant here, could be looking at a further downturn in its steel production as many of its steel manufacturing industries are in the process of closing shop owing to a short supply of iron ore.
More than half of the 60 sponge iron plants in the state have already shut shop and several others have partially suspended operations with the mining ban creating a shortage of raw material , according to the Karnataka Iron and Steel Manufacturers Association.
Currently about 22.5 million tonnes of ore is produced a year as against the requirement of about 34 to 36 million tonnes annually in the state, according to Mr Vinod Nowal, deputy managing director of JSW Steel, which imported around six million tonnes of iron ore last year to make up the shortage.
“We had to import because ore production in the state has fallen following the ban on mining imposed by the Supreme Court. The steel market is not very good either. With the recession, importing ore can only lead to loss of precious foreign exchange,” he explained.
Noting that the Supreme Court's cap on iron ore production is causing a slowdown in steel production in the state, Ballari-Sandur-Hosapete Mine Owners Association secretary, Hothur Mohammed Iqbal, feels its time for the government to intervene to prevent a further slide.
“The steel sector is now on the verge of closure in the state. The government needs to approach the Supreme Court to lift the cap on iron ore production and accelerate the process of auctioning of category C mines to contain the damage,” he stressed.
