An increased demand in chromite production could lead to a rise in dependence on imports, a Mines Ministry report has mentioned. Chromite is used to make stainless steel and heat-resistant steel.

Production has been at 1 to 1.1 million tonnes (mt) over the past 4 to 5 years.

The Mines Ministry report, reviewed by businessline, is based on the production, export–import and other parameters relating to 2021, and adds that an Expert Committee previously set up by the Ministry of Steel has recommended the need for a “detailed exploration of chromite in all the potential areas” in Odisha, Karnataka and in the ophiolite (a section of Earth’s oceanic crust that has been uplifted and exposed) belt of North-Eastern region “with a view to predict resources to a depth of 500m in Sukinda belt and estimate resources in all other potential areas”.

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At present, mining operations for chromite are restricted in the Sukinda ultramafic belt (consisting of rocks), in the Baula Nausahi chromite belt in Odisha and in Hassan district of Karnataka.

“Addressing concerns in ferro-chrome production which is energy intensive segment is also essential. Setting up of such plant must strike a cost balance between raw materials and electrical energy supply,” the review report mentions adding that other sectoral issues include factors like having a consistent supply of chrome ore “at the right cost”, steady power supply and (supply of) other input materials like low phosporous met coke.

The report adds that in India, production of ferro-chrome or charge chrome is primarily by Ferro Alloys Corp, Shri Vasavi Industries, Balasore Industries, Tata Steel, Indian Metals & Ferro-Alloys (IMFA).

India consumes 15-30 per cent of its production and exports the rest to countries like China, South Korea and Japan. However, over the years, exports declined substantially by 91 per cent, whereas imports were up by 20 per cent (from Mozambique, Russia, etc).

Reasons for slower than expected offtake in demand at a domestic level is primarily because a majority of the players in India (apart from IMFA, Tata Steel and Balasore Industries) are in “financial difficulties”; while domestic stainless steel production – a key consumer industry - “of late is under severe duress”.

Incidentally, in the future outlook segment, the report mentioned that whilecurrent status of chromite production and consumption is on anticipated lines, “the consumption could increase enormously in the coming years and the country may have to depend on imports even for the domestic needs.”