No Ore: Visa Steel shuts plant, more follow

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posted on 13 years ago — updated on 1 second ago

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BHUBANESWAR: The steel rush of the Orissa Government has hit a dead end with industries located at Kalinga Nagar Complex beginning..

BHUBANESWAR: The steel rush of the Orissa Government has hit a dead end with industries located at Kalinga Nagar Complex beginning to shut shop. Thanks to nonavailability of iron ore, most of the industries which were promised moon by the State Government are now waking up to the rude reality.
VISA Steel has stopped production while others have followed suit. The 2.5million tonne VISA Steel was dependent on Gandhamardan and Daitari Iron Ore Mines of Orissa Mining Corporation (OMC). However, Gandhamardan has suspended operation two months ago, cutting supply of raw materials to the steel plant.To add to their woes, a fortnight back, supply from Daitari was stopped. Bizarre as it may sound, the OMC suspended its supply from Daitari mines since it realised that the stockyard, known as Baliparbat, is located in a forest area and the mines do not have necessary forest clearance.

"We needed at least 1.15 lakh metric tonne ore every quarter for running the blast furnace and DRI but could not get even half the requirement because Gandhamardan was closed. Now, with the closure of supply from Daitari, there is no option but to shut down the plant," sources in VISA Steel said.

In fact, the pricing mechanism of OMC, which is decided every quarter basing on the highest bid, had already hit the industries hard but they continued their production even at extremely high costs. Snapping of the supply has dealt a body blow to them.

"Baliparbat has been the stockyard for the last 50 years and OMC has termed it as forest land last month. We are surprised how OMC did not take any action even during the closure of mine between April 2010 to October 2010 because it did not possess environment clearance," All Orissa Steel Federation president PL Kandoi said.