What is the reason for mushrooming of mini sponge iron plants?
A 60,000 tonne-a-year plant without power generation will cost Rs 24 to 25 crore and a small plant of 50 tonne-per-day will cost Rs 5 to 6 crore. It is a small investment and that is why people are going in for small plants. The margins are also reasonably good. They are able to maintain prices but not quality. There is no process control and pollution is a main concern as most of them go for coal-based plants and not gas, which is a clean fuel but which costs more and availability poor. Ninety per cent of the world production is gas-based. Out of the 10 per cent coal-based plants, India accounts for 78 per cent. How much of a shift has occurred in the industry towards sponge from scrap? The sponge-scarp mix depends upon the availability and price of scrap. Most manufacturers use 70 per cent sponge and 30 per cent scrap. If a few ships land in Kandla scrap availability goes up and the ratio can go up to 50:50. Who are the major users of sponge iron? We cater to electric arc furnaces an
