India’s medium-sized and small iron and steel producers have sought a ban on exports of iron ore from the country, which have resulted in rising prices of the raw material in the domestic market, SteelOrbis learned from industry circles on Monday, February 26.
According to the industry, Indian exports of iron ore touched 44 million mt in 2023, a surge of 44 percent over the previous calendar year at a time when domestic demand was also rising, resulting in higher prices for small and medium-scale iron and steel mills.
“We have asked the government to ban exports of all forms of iron ore, otherwise China’s steel industry will run and ours will shut. India should be an exporter of steel and not iron ore,” Chhattisgarh Sponge Iron Manufacturers’ Association president Anil Nachrani said.
He stated that five major iron and steel producers in Chhattisgarh had come together to lobby the steel ministry after many had started to incur losses. Second-tier producers, which account for about 40 percent output, have been paying almost four times more than larger mills for iron ore.
Large mills can negotiate better prices for inputs like iron ore and coal and most have captive iron ore mines of their own, Mr. Nachrani said.
“On the one hand, demand for iron and steel products from small and medium-scale mills is decreasing and at the same time they cannot compete with large mills having their own captive coal and iron ore mines. Small and medium mills have no option but to source raw materials at higher prices following rising exports of raw material to China,” Deependra Kasiva, director general of the Sponge Iron Manufacturers’ Association, a national-level representative body, commented.
In late 2022, the Indian government scrapped the export duty of 45 percent on pellets, while the duty on iron ore lumps and fines with less than 58 percent Fe content was reduced to zero. Lower grade fines are the product mostly exported, while iron ore with Fe content over 58 percent mainly stays inside the country with the export duty at 30 percent.