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As a direct fall-out of the iron ore mining scam in Karnataka, JSW Steel has closed down two blast furnaces having a steel production capacity of about 2.3 million tonnes at its Vijayanagar plant in Bellary district due to unavailability of iron ore.
“I can confirm that two blast furnaces have been shut down as there is no iron ore available. Our production has gone down by 35 to 40 per cent,” JSW Steel Director (Commercial and Marketing), Mr Jayant Acharya, told PTI.
He added that depending upon the availability of iron ore, the company would decide when to re-start the blast furnaces.
However, the company Marketing Director refused to comment on the extent of losses due to production cuts.
“We would not like to quantify it at this juncture,” Mr Acharya said.
JSW Steel, whose iron ore requirement stands at about 60,000 tonnes per day, sources about half of its requirement from the Bellary-Hospet region in the State and has about two-three days stock left.
Last Friday, the Supreme Court had ordered suspension of all iron ore mining operations in the Bellary region on account of environmental degradation in the area. Steel and allied industries have said that this would lead to closure of their operations as they have no stock left.
Yesterday, Tata Metaliks, a subsidiary of Tata Steel, said due to the paucity of iron ore, it may close down its 2 lakh tonnes per annum pig iron plant in Goa in a week as the plant is dependent on iron ore supplies from the Bellary-Hospet belt in Karnataka.
The Karnataka Iron and Steel Manufacturers’ Association (KISMA) gave a presentation to the Steel Minister, Mr Beni Prasad Verma, yesterday in this regard.
Moreover, in a separate statement, the Bangalore Chambers of Commerce and Industry has said the suspension of iron ore mining could adversely impact the country’s Gross Domestic Product by 0.5 per cent, amounting to $8.5 billion.
“Karnataka-based iron and steel companies are approaching a critical stage of closure of their manufacturing activities in the next 2-3 days following the Supreme Court pronouncement last Friday halting iron ore mining activities in the Bellary region,” it added.
Karnataka produces 16 mt iron and steel in a year, which is a little less than 25 per cent of the country’s total production.
The State also produces more than a fifth of India’s total iron ore production, which is around 220 mt annually. Of this, about 80 per cent comes from the Bellary-Hospet region.
Half of the production from the Bellary-Hospet region is consumed within the State, including the steel plants of JSW Steel, Kalyani Steel and Mukund Steel.
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