India fulfills demand for iron ore in the domestic market
India’s iron ore imports have come down by 78% in April-June quarter of FY 14 in comparison to the imports of same period last year, as per the provisional data provided by government sources. Imports have come down as India’s total output is fulfilling requirement in the domestic market and iron ore export to the global market has also narrowed.
China, the topmost consumer of iron ore, has also reduced import by 9.1% in June, 2013.Therefore, global prices of iron ore which are already down by 12% are expected to drop down further in the near future.
India has produced enough iron ore this year to meet the demand of the domestic market. In the year ended March 31, 2013, India’s imports were tripled to 3 MnT after government had banned mining from its largest mining state, Karnataka, which was alleged for illegal mining.
Recently, when the government allowed mining operations to be resumed in the state of Karnataka, miners started following the rules and operated mines only within the areas allotted to them. An increase of 30% export duty has also increased domestic sale of iron ore.
India had imported around 826,372 MT of iron ore during quarter ended June 30, 2012, which has come down to 185,113 MT in quarter ended June 30, 2013, according to the figures provided from the agency which tracks the data for the commerce ministry. However, the final data is expected to arrive by the end of August, 2013.
At a point in time, India was the third largest iron ore exporter of the world, exporting around 98 MnT of iron ore, i.e. 47% of its total production, in the year ended March 31, 2011. But, its exports have decreased after a ban on mining in Karnataka and Goa. Meanwhile, the total production of iron ore of the country has come down to about 140 MnT this year which was around 207 in the year ended March 31, 2011 and 167.3 MnT in the year ended March 31, 2012.
Source : Reuters