INDUSTRY UPDATES On 27th September, 2012


INDUSTRY UPDATES
On 27th September, 2012
STEEL, METALS AND MINING
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COAL
RON ORE
PIL filed un supreme court for ban on mining of Iron, Manganese in Goa
A PIL was filed in the Supreme Court on Wednesday seeking a court direction to stop illegal mining of iron and manganese ores in Goa. The PIL filed by the Goa Foundation, an NGO active in the state, also sought a ban on all trade activities of the illegally mined ores.

The PIL sought a Bellary-type inquiry into all mining leases sanctioned in the state. The state has banned all mining pending a review of all licences. The ban was declared on September 10, 2012. But the NGO insisted that the illegal mining continued in the state.

The PIL was filed through activist lawyer Prashant Bhushan. The PIL alleged that illegal mining was going on in Goa in violation of the provisions of the Forest Conservation Act 1980, the Indian Forest Act, 1927, national forest policy, the Mines and Minerals (Development & Regulation Act, 1957 (MMDR) Act and Mineral Concession Rules, 1960. This raises serious concerns about damage caused to the ecology of the state as also issues concerning transparency and accountability in governance, the PIL said.

"When compared to Bellary, where this court has had sufficient grounds to pass stringent directions in public interest, the situation in Goa is far worse in terms of extent of illegal mining, plunder of public resources, collusion of authorities at all levels and total degeneration of the environment," the petition said.

"It appears as if rule of law no longer exists as the concerned departments, including the Indian Bureau of Mines, Ministry of Environment and Forests and Departments of State viz. the Forest Department, the Goa Pollution Control Board and the Department of Mines and Geology are all complicit in permitting the illegality to continue unabated," the PIL said.

The PIL also cited the Shah Commission report to press for a Bellary-type inquiry into encroachment and lease violations.

The PIL claimed that ban order had not affected "trade and transportation of ore already mined and existing in the lease-hold area, in transit or stores or stocked on the jetties." It also expressed unhappiness with the proposal to permit trade in existing stocks when the commission had unambiguously questioned the validity of every working mine. The proper course of action is to carry out a survey and seize the stocks, the PIL said.

It sought an independent committee to go into the issues raised by the Shah Commission. In the alternative, the court could direct the Central Empowered Committee (CEC) to undertake this function.
(Economic Times)

CEMENT
Cement sector continues to face headwinds, Says ICRA
Credit rating agency IcraBSE -0.25 % today said the outlook for the cement sector continues to remain challenging due to rising input costs, unfavourable demand- supply scenario and overcapacity.

"In view of rising input costs, unfavorable demand- supply scenario and continuance of fundamental issues plaguing the cement industry, the outlook for the sector seems challenging," Icra said in a report.

The fundamental issues affecting cement demand in FY11 and H1 FY12 continue to persist, it said.

"Subdued demand and significant capacity addition had put pressures on capacity utilisation of the cement industry. Apart from unfavorable demand-supply scenario, the industry is also reeling under the pressure of rising input costs."

Prices of key raw materials like limestone and gypsum have increased, it said. "Besides, the increase in domestic coal prices and non-availability of low cost linkage coal has increased the power and fuel cost for cement manufacturers."

Cement companies depending on imported coal have seen some easing in cost pressures due to decline in price of imported coal, the rating agency said.

"However, the benefit of declining prices has been off -set by rupee decline to some extent. In addition, the freight costs have increased due to increase in surcharge and cess by the Railways last year and hike in freight rates for some commodities in March. The recent hike in diesel prices will further escalate the cost of production for cement companies."

In the long-term, however, the agency expects the sector to see higher demand from residential and commercial space, huge investments planned in the infrastructure sector and Government expenditure under various schemes.

However, it cautioned that since cement demand is correlated with economic development, the extent to which the issues affecting investment in projects are addressed would be critical.
(Economic Times)

AGRICULTURE
FERTILISERS
Fertiliser Ministry to expedite proposal to hike urea prices
Concerned over rising subsidies, the Finance Ministry has asked the Fertiliser Ministry to expedite the proposal to hike urea prices. "The Finance Ministry has asked (the Fertiliser Ministry) to accelerate the proposal to raise urea prices...," sources said.