Even as revival of ferroalloys units has gained momentum after the State government decided to adjust Rs.1.50 discount per unit in the bills issued to them, hefty increase and delay in shipment of manganese ore – the principal raw material has become a matter of concern for the managements. Presently out of 31 units across the State, 23 have launched revival operation including major ferroalloys unit FACOR in Vizianagaram district. Four units are non-functional for other reasons. The maintenance work is now in progress in most of the units and the production is expected to start in a month or so.
Industry sources say steep increase in price of manganese ore, which is sourced from South Africa and Australia, has not only giving them sleepless nights but also the delay in arrival of consignments is causing them a serious concern.
Manganese ore production in India is very low. It is also of low quality. Hence, the manufacturers blend imported ore with domestic ore meeting 5 to 10 per cent of their requirement. Steam coal, another raw material, which used to be imported, is now available in good quantity in India. Coke, a by-product of Rashtriya Ispat Nigam Limited, is also available in plenty. The manganese ore price in the international market has undergone three-fold increase in past one year or so. Moreover, countries like Malaysia are offering power, another important requirement for ferroalloys production, at throwaway price.
Cause for crisis
Ferroalloys units, which employ 10,000 to 15,000 workers, ran into crisis and most of them shut down their operations following frequent increase in power tariff. On their representation, a Cabinet Sub-Committee has been set up with Finance Minister Yanamala Ramakrishnudu as its chairman to consider their plea.
The State Cabinet at its meeting on September 22 resolved to adjust the rebate given to them in the bills so that they could avoid getting delayed reimbursement.
