Iron ore exports could surge with rising prices
With iron ore fetching US$ 100 per ton, the highest in the last 5 years in the international markets, India’s exports of lower grade iron ore could increase. According to international trade regulations, exports of iron ore of up to 58% attract zero import duty; as soon as iron ore of this quality crosses US$ 70 per ton in valuation, exports become viable. Since there’s not much demand for this kind of iron ore in the domestic market, the producers mainly rely on exports.
Earlier, the exports were low because of the flagging demand and India turned a net importer in 2018-19. However, supply disruptions in Brazil and Australia and plummeting inventories at China’s ports have encouraged the steel makers to source more iron ore, reviving demand for Indian exporters.