With 5 to JSW and 2 to MSPL, High Premiums in Karnataka

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10 October 2016

Steel producers like JSW Steel, MSPL etc are quietly paying huge premiums in Karnataka ‘C’ category mine auctions to attain iron ore mines in the state. Faced by acute shortage and unreasonable price hikes by private and state owned iron ore miners, these steel companies are willing to pay huge premiums to become self sufficient in iron ore.

Speaking to a subject expert from Bangalore, KATM learned that iron ore prices in Karnataka are comparatively higher than rest of country and taxes levied on the end users are an add on burden.  High logistics involved to transport iron ore from Orissa to Karnataka adds up to the costs and miners use their own discretion to modify the prices without prior notice.

Domestically Indian iron ore production looks adequate for steel production within India, though regional basis Karnataka suffers an acute shortage because of iron ore auctions and cap of Supreme Court on production of the mineral.

This is prompting the end users to pick up iron ore mines in region and bring some certainty in their raw material requirement.  The list of the mines won by the companies is as following –