Post News Network
Bhubaneswar, March 16: Commodity slowdown has hit pellet plants in the state hard as prices have slumped by around 50 per cent in the last one year or so.
According to data furnished by Jindal Steel and Power Ltd (JSPL) in its investor presentation, pellet prices in Barbil-Keonjhar region of the state witnessed a fall of 44 per cent since April 2015 and by around 16 per cent since Oct, 2015.
Average price trend graph of the pellet shows that prices declined from Rs 5,350 per tonne in April, 2015 to Rs 3,000 in February, 2016.
Earlier, Pellets Manufacturers’ Association of India (PMAI) has accused the state iron ore producers of cartelisation and jacking up prices of iron ore through deliberate cutting down of supply.
Fall in domestic steel price, unavailability of iron ore coupled with low demand for pellets have forced many firms to shut down units in the state in last two years.
Experts say if demand environment doesn’t improve in coming months, existing units may be forced to be on the same lane. However, they opined that the government’s move to reduce export duty on iron ore pellets to zero from 5 per cent may the save the day for pellet plants in the state as this is likely to make the commodity more competitive amid subdued demand environment and weakening prices.
