This is aimed at increasing the availability of raw materials at competitive prices, they said.
"It has been conveyed to them that iron reserves are limited in the country and to preserve that, players must also use low grade ore through beneficiation process. They can also look for coking coal mines outside India," the sources said.
Iron ore and coking coal are the two key raw materials used for manufacturing steel through blast furnace route. While iron ore is available in abundance, for coking coal, India remains heavily dependent on imports.
Major players use only high grade ore (lumps), with 65% and above iron content, to make steel through BF (blast furnace). Fines are low grade ore having iron content or 64% or less.
Beneficiation of low grade ore adds to the overall cost of production.
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