Exports of iron ore from Paradip port in India's eastern state of Orissa have fallen 13.6 percent to date in the first quarter (April to June) of the current Indian fiscal year (FY 2011-12), due to stringent rules imposed by the local government and a fourfold increase in export tax, Reuters has reported.
According to a port official, exports totaled 2.55 million mt in the period in question compared with 2.95 million mt in the year-ago quarter.
Exports from Paradip, India's second-largest iron ore exporting port, dropped 14.2 percent to 13.84 million mt in the fiscal year 2010-11 ended on March 31, compared to the previous fiscal year.
"There is hardly any movement from Orissa due to high railway freight and export duty. There is no feasibility in the market, and exporters are losing INR 500-800/mt ($11-17/mt)," said Dhruv Goel, managing director of Orissa-based iron ore trader SteelMint.
Lower exports from India, the world's third biggest exporter of the steelmaking raw material, have resulted in a tight supply situation in the global market amid thin buying by China.
Meanwhile, since the beginning of the week, China reports rising iron ore inventories at its ports probably due to cautiousness of the steel mills towards booking activity given the slowing down of the domestic steel industry.