Chi Jingdong, vice secretary and chief analyst of the
China Iron and Steel Association (CISA), has stated that it would be difficult for
India to exit the Chinese
iron ore market within five years.
The CISA official's remarks were made in response to a recent statement by Rana Som, chairman of NMDC, the largest Indian state-owned
iron ore producer, to the effect that
India will gradually retreat from the global
iron ore market and will no longer export
iron ore to
China within five years.
In April 2010, the Indian government decided to lift its lump ore export tax from 10 percent to 15 percent and to increase the rail charge for
iron ore exports by INR 100/mt. In March 2011, the Indian government announced it was increasing its fine ore and lump ore export taxes from 5 percent to 20 percent and from 15 percent to 20 percent respectively.
In 2010, Indian steel production totaled 67 million mt, while its
iron ore output reached 210 million mt. Mr. Chi stated that in recent years Indian
iron ore exports have seen their market share in
China fall to 11 percent, and that this share is expected to decline further in the future. In addition, most Indian
iron ore consists of low grade material. Thus, Mr. Chi said he expects that any change in volumes of Indian
iron ore imports will not have any big impact on the Chinese market.