Concerned over the depleting reserves of chrome ore,the steel ministry has demanded a complete ban on its exports. The ministry warned that the country may soon run out of the costly steel-making input if it failed to plug exports.
Since India has barely 1 per cent of the worlds total medium and high grade chrome ore reserves,it cannot afford to lose the mineral,the ministry said. According to available data,India had roughly 50 million tonnes of charge chrome grade ore but the countrys reserves is said to have depleted to 38 million tonnes.
Despite this low reserve base,we are exporting nearly 5 lakh tonnes of chrome ore a month. So,we are categorically in favour of a ban on chrome ore exports and have conveyed our opinion to the concerned departments, steel secretary P K Misra told The Indian Express.
Chrome ore is used in making ferrochrome,which is further used in making stainless steel. This grade of steel has considerable demand from the construction sector and an expanding automobile industry,which uses the non-corrosive material for external body surfaces.
The Dang Committee,set up by the steel ministry in 2005,had also,in its report,favoured a total curb on exports of the mineral citing the countrys paltry reserve base,which is mostly confined to Sukinda valley and Boula in Orissa. If exports continue,the mineral reserves may not last more than 20 years.
The steel ministry also feels that the chrome feed grade be reduced from the current 42 per cent to 38 per cent to curb misuse of exporting chrome ore as chrome concentrate.
The ministrys concerns on raw material security for steel makers are on the rise following rising prices of inputs across the world and the lead taken by Chinese firms in securing global mineral assets.
While Chinese buyers are still enthusiastic about Indian iron ore,which easily fetches local exporters around Rs 1,500 a tonne,the price of coking coal,another crucial input,is hovering around $300 a tonne.
In its pre-budget recommendation to Finance Minister Pranab Mukherjee,the Indian Ferro Alloys Producers Association had demanded that customs duty on chrome ore be abolished as these are not adequately available in the country. But the Budget hiked customs duty on all ores and concentrates from 2 per cent to 2.5 per cent.