en.Wedoany.com Reported - The Odisha Directorate of Mines & Geology (DMG) has introduced stricter regulations for mineral dispatches, stating that shipment permits will not be granted for ore grades falling below the benchmarks specified in approved mining plans.
The directive, issued on June 16, 2026, aims to curb practices such as grade dilution, illegal blending, misclassification, and underreporting of ore grades, which could impact the collection of royalties and other statutory dues. Under the revised instructions, the annual average ore grade approved by the Indian Bureau of Mines (IBM) in the mining plan has been set as the minimum permissible benchmark for mineral dispatches within the mining lease.
Odisha's current approved environmental clearance (EC) cap for fiscal year 2026 stands at 278 million tonnes. In the previous fiscal year, the state produced approximately 158 million tonnes of iron ore, accounting for about 50% of India's total iron ore output. Field officials have been instructed to enhance monitoring of production, dispatches, and stock levels to identify discrepancies in reported quantities, production suppression, and unaccounted mining. The circular explicitly states that under no circumstances shall ore below the approved annual average grade be allowed for dispatch.
A trader noted that iron ore dispatches across various regions have slowed since midnight, and subsequent shipment permits may be hindered by the proposed stricter rules. Any vehicle transporting ore that does not match the quality approved in the annual mining plan could be seized. If this situation persists, supply issues may arise, potentially leading to price increases.
For cases where the annual average grade is not specified in the mining plan, the directive requires the weighted average grade from geological reports of active working faces or benches to serve as the reference benchmark for dispatch approvals. A miner pointed out that the DMG has clarified the regulations regarding shipment permits for materials with an average saleable grade in approved mining plans. Previously, some entities allegedly manipulated reported iron ore grades based on IBM prices to adjust royalties, practices currently under government scrutiny. However, existing dispatch permits issued based on prior approvals remain unaffected by this notification.
Additionally, for cases where blending is permitted in the approved mining plan, the final blended grade must be equal to or higher than the specified benchmark grade. Following the state-level directive, the Deputy Director of Mines in the Joda region has also instructed mining lease holders not to apply for permits to dispatch ore grades lower than those approved in the mining plan.
With the latest directive, scrutiny of ore dispatch approvals is expected to intensify, and grade compliance monitoring across mining operations in Odisha may also be strengthened.
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