Indian state halts output at 23 iron ore mines

India's biggest iron ore-producing state said Saturday it had withheld permission from 23 mines to operate because they had not supplied proof of environmental and other clearances. The mines affected by the move by the Orissa government in eastern India are in Keonjhar district, state mining deputy head Umesh Jena said.
Orissa produces some 75 million tonnes annually of iron ore, the key raw material for steel. "We have asked operators to supply documents like forest clearances, mining leases and surface rights within a week," Jena told AFP. "Till then, they can't carry on mining", he said, adding further action would "be initiated" against them if they did not submit the papers.
India is the world's third biggest iron ore supplier with nearly half of its output of over 200 million tonnes exported to China, which has the world's biggest steel industry. Orissa's move comes as part of a drive to more enforce regulations introduced in 2009 amid charges many mines were functioning without licences. Orissa has some 600 mines but over 50 percent have been closed for more than a year since the crackdown began.
The government also said earlier this month said it was considering seeking a ban on exports of iron ore to stop illegal mining and boost local supplies. Orissa's government found at least 2,823 cases of illegal mining in the five years to June 2009, according to the Press Trust of India. India's steel industry has been pushing for a ban on iron ore exports to make more of the raw material available locally at cheaper prices.
The country's booming economy faces increasing demand for steel to build badly needed infrastructure and to meet burgeoning demand from the consumer durable goods sectors. If the Orissa state government's export ban wins acceptance from the federal government it could sharply reduce India's iron ore exports, which have already slumped due to a halt in overseas sales by southern Karnataka state in July. The drop in exports is seen forcing China to rely more on supplies from Australia and Brazil.