India: JSPL Worried About Increasing Raw Material Costs

The consistent increase of input price for the steel industry is resulting in hiked cost of production. The steel industries are facing difficulties as the raw material prices are increasing, whereas the price of finished steel products is going down. It is to be noted that during, April to July 2018, steel prices have come down from INR 41,000 to INR 39,000/MT, whereas prices of Iron ore lumps have surged by 10.58% from INR 4,725 to INR 5,225/MT and fines by 17% from INR 2050-2400/MT.

JSPL`s Chief Naveen Jindal very much worried about the situation in Odisha. He said that, “There is scarcity of coal for steel industries. The premium for coal in e-auction by Mahanadi Coalfields Limited (MCL) goes up to 100%. In Odisha we are buying costliest coal through e-auction.” He urged upon MCL and Coal India to increase production. If coal production does not increase according to the demand of industries them the steel sector will suffer a lot, he added.

His observation on the situation is that, “While iron ore price in international market is decreasing, the same in Odisha is increasing. Also the transporters are increasing the freight rate time to time. This adds to the challenges faced by steel industries in the state. He requested the Government to take immediate steps to increase iron ore availability for the industries in competitive price and implement the notification regarding freight rate for mineral transport in the state.

JSPL`s Chairman also said a number of steel industries are under NCLT. Therefore the government should intervene to rationalize the input prices and the transportation rates in the interest of overall economy of the State.

He also demanded for increasing availability of railway rakes for transfer of raw material for industries. Similarly he also demanded for increasing coal production by MCL to make coal available for power generation.

The 6 MnT pa integrated steel Plant at Angul is the largest steel manufacturing plant in the state of Odisha which includes India`s largest pelletisation complex of 9 MnT pa capacity at Barbilin Keonjhar district and steel plant of 6 MnT pa capacity.