India’s 2022/23 iron ore exports hit five-year low

India’s iron ore exports are set to fall 24% in the current fiscal year to a five-year low
March, industry officials said Wednesday, as an export tax introduced last May stalled
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India is expected to export about 20 million tons of iron ore in 2022/23, up from 26.3 million last year, officials said, with China remaining by far the largest buyer. In May 2022, the government imposed a 50% export tax on low-grade iron ore lumps and fines – with an iron content below 58% – and a 45% export tax on pellets to meet increasing local demand.

Although the export tax was scrapped in November, demand for iron ore supplies from India only started to gain momentum from February 2023, said RK Sharma, secretary-general of the Federation of Indian Mineral Industries.

“Exports started to increase in February because the Chinese market picked up slightly and exports only go to China,” Sharma said. “Those are basically bad grades.”

Between April and January, the first 10 months of fiscal year 2022/23, India’s iron ore exports to China totaled 10.6 million tons, down 43% year-on-year. Government data showed that shipments to Beijing accounted for 81% of New Delhi’s total iron ore shipments.

In the fiscal year ending March 2022, China bought 21 million tons of iron ore and concentrates from India, effectively buying 80% of New Delhi’s total exports of 26.32 million tons.

Low grade ores accounted for 92% of India’s total iron ore exports.

Indian producers of low-grade ores are largely dependent on foreign markets, as most of the major domestic steelmakers use high-grade iron ores.

The eastern state of Odisha, India’s top iron ore producer, has forecast a 50% drop in shipments this fiscal year due to the export tax introduced in May 2022.

“We’ve already lost time from June to December, the six months we can’t make up this year, so export will definitely be less than 50%,” said G. Rajesh, Odisha Mine Director.

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