BackVedanta to export 5.5 mt of iron ore from Goa this fiscal
Move comes as the company restarts operations with the permission of the Supreme Court
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Bengaluru: London-listed metals group Vedanta resources Plc said it would export 5.5 million tonnes (mt) of iron ore from its mines in Goa by March as the company restarts operations with the permission of the country’s apex court.
Mining in the key iron ore states of Karnataka and Goa was banned in 2011 and 2012, respectively, following a crackdown on illegal mining by the Supreme Court and the government.
“Mines in Goa will export about 20 mt of iron ore in the fiscal year ending March 2016," said R. Kishore Kumar, chief executive officer of Vedanta’s iron ore business. “Out of this, Vedanta will export about 5.5 mt."
The Supreme Court has allowed Vedanta to mine only 5.5 mt of iron ore, but the company is seeking a relaxation on the limit to become competitive in a global market that has witnessed a meltdown in price of the commodity used to make steel.
“If we are given a larger production capacity, we are in a position to become competitive," Kishore said adding that Vedanta was targeting a production cost of $20 a tonne. Iron ore prices are currently hovering at about $40 a ton from Goa on free-on-board basis.
Vedanta has moved the apex court to relax the cap on mining in Karnataka where it is allowed to mine only 2.29 mt. In Goa, the state government has filed an affidavit in the court seeking to reconsider the cap.
“We are in an over-supplied market, at least in the next couple of years. We can’t bring down costs unless we ramp-up capacity. So, the mining limit has to be enhanced," Kishore said.
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