 "JSW Steel increases production levels at Vijayanagar plant")
New Delhi: Thanks to a recent auction where JSW Steel secured over 1.8 million tonnes of iron ore, it has managed to “slightly” increase production levels from its 10 million tonnes per annum Vijayanagar steel plant in Karnataka to 35-40 per cent of capacity.
“The situation has improved slightly. We are currently producing at about 35-40 per cent of total capacity. One blast furnace and one Corex unit is operational. If iron ore movement improves, our production will also improve,” a senior company official said.
Late last month, the company had gone for a massive 70 per cent cut in production to 30 per cent of installed capacity due to acute iron ore shortages.
“There are big issues related to the delivery of the auctioned iron ore, due to which we are not able to raise our production to a big extent,” the official further said, adding that “delivery of the ore has been less than one lakh tonnes despite JSW buying over 1.8 million tonnes in the auctions”.
[caption id=“attachment_105978” align=“alignleft” width=“380” caption=“JSW requires about 1.65 million tonnes of iron ore to run the Vijaynagar plant at full capacity. Reuters”]
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Citing logistics and delivery-related issues, the official refused to provide a time frame for the company to resume 100 per cent production levels from the plant.
“Yes, now we can run our plant at 100 per cent capacity as and when the raw material reaches to Vijayanagar, or at 80 per cent capacity and keep some of it as inventory. But I can not give you a timeline right now,” the official said.
JSW requires about 1.65 million tonnes of iron ore, having 62 per cent Fe content, to run the Vijayanagar plant at full capacity, while about 3.34 million tonnes of iron ore has been auctioned since September.
Since August, steel and allied industries in Karnataka, including JSW, have been facing acute shortages of iron ore, following the imposition of a mining ban in the state by the apex court.
To resolve the crisis, the Supreme Court had allowed the e-auction of 1.5 million tonnes of iron ore per month out of stocks lying idle at various mines in the state.
However, the iron ore supply crisis at JSW deepened late last month, when its long-term supplier NMDC stopped supply of the raw material.
The state owned company was adhering to the apex court order for selling all its ore from the state through the e-auction route only.
Explaining the supply related bottlenecks, the official said that only nine delivery points have been opened so far and all the companies that secured ore supplies through the auction have to queue up there.
Besides this, trucks can only travel on roadways for 12 hours, between 6 am and 6 pm.
“So unless the time for movement of trucks is increased or more delivery points are made open, the problem remains,” the official said, adding that “unless the logistical issues are resolved, we are not optimistic of running our plant at full capacity,” the JSW Steel official said.
The company has also requested the apex court appointed monitoring committee to follow the model of other states like Orissa and Chhattisgarh and asked the State Forest Department to allow 24-hour truck movement.
PTI