KIOCL Ltd (formerly known as Kudremukh Iron Ore Company Ltd) has temporarily suspended the operation of its pellet manufacturing unit in Mangaluru with effect from August 23.
The company informed the stock exchanges that the operation of company’s pellet plant has once again been temporarily suspended ‘shed full condition’. This condition resulted out of lack of demand in domestic market, and unviability in international market in view of duty imposed on export of pellets by the Government through its notification dated May 21.
Earlier, on June 7, the company had informed the stock exchanges about the suspension of operation at the pellet plant. However, it had restarted the operations at the pellet plant on August 12. Now, the company has shut its doors once again .
According to the 46th annual report of KIOCL for 2021-22, the company earned a revenue of ₹3,006.45 crore from operations as against to ₹2,376.44 crore in 2020-21, recording a growth of 26.51 per cent. Revenue from export sales increased by 58.66 per cent to ₹2,928.97 crore in 2021-22 as against ₹1,846.06 crore in 2020-21.
The report mentioned that the company achieved export sales of 2.032 million tonnes of pellets (which is the highest since closure of captive mine at Kudremukh) against 1.844 million tonnes in the previous fiscal. KIOCL achieved 97.42 per cent of its total revenue from its operations through export, it said.
It may be mentioned here that the Union Steel Ministry had written to the Central Board of Indirect Taxes and Customs (CBIC) recently, seeking exemption of export duty on iron-ore pellets manufactured and sold by KIOCL in overseas markets, as the export duty imposed is impacting operations of the company which in turn is hitting foreign exchange earnings.