Friday, Jan 20, 2012
Talk about an opportunity wasted, literally.
Not long back, heaps of low-grade iron ore refuse lying unused in vast mining tracts of Goa had found a throbbing market in China. But thanks to the government’s recent hike in export duty, the ore material has once again lost its utility value, whatever little there was. The finance ministry on January 2 raised the export duty on iron ore to a flat 30% from the 20% earlier.
The result? The iron ore waste export market, which was turning into a steady cash flow for the state, the Centre and owners of the ore, died even before it was born. Out of an accumulated waste of 800 million tonne (mt), close to 80 mt was commercially saleable and had become a big source of revenues in the form of royalty and other duties.
This has come to a grinding halt, said Ambar Timblo, managing director, Fomento Resources, one of the biggest privately held mining companies in Goa. “The hike in export duty has rendered these low-quality ores commercially unviable due to the low price they fetch.” “Even if we consider an annual sale of 10 mt of this ore at an export duty of 10%, this would mean a royalty of `220 crore and an export duty value of `300 crore,” Timblo said.
To be sure, whenever a new mine goes on stream, several thousand tonnes of earth get dug up to reach to the premium ore content. This dug-out matter lies near mine pit heads as heaps of dumps.The low content of ferrous — between 45% and 52% — makes the ore highly unsuitable for use in India. In fact, none of the iron ore mined in Goa ever manages to make its way to any Indian plant. That explains why a huge chunk —as high as 99%— of the mineral is exported from Goa.
To its credit, the state government had some business sense and a few months ago, allowed export of very low-quality ore that had no takers. It’s back to square one.
(sourced DNA)
Showing posts with label curb iron ore exports. Show all posts
Showing posts with label curb iron ore exports. Show all posts
Friday, January 20, 2012
Thursday, January 19, 2012
Export curbs hit ports income
Thursday, 19 Jan 2012
Curb in iron ore exports and hike in duty on outbound shipment have resulted in a number of Centre owned major ports incurring heavy losses of business.
Shipping secretary Mr K Mohandas on the sidelines of a conference told reporters that “All ports have suffered huge losses of business, including New Mangalore, Ennore, Visakhapatnam, Paradip and Mormugao.”
Mr Mohandas said ports are dependent on cargo and iron ore used to contribute significantly in ports’ business.
He also added that mining and exports policies did not come under Shipping Ministry’s purview when asked whether the ministry is taking any step in this regard.
The iron ore exports from the country last fiscal came down to 97.64 million tonne while in the first eight months of the current fiscal, exports dipped by a little over 28% to 40 million tonne vis a vis the corresponding period last fiscal.
Apart from this, upward revision in export duty to 30%, the miners said that will result in total shipments unlikely to exceed 50 million tonne in the current fiscal, which is further bound to impact the ports.
(Sourced from PTI)
Curb in iron ore exports and hike in duty on outbound shipment have resulted in a number of Centre owned major ports incurring heavy losses of business.
Shipping secretary Mr K Mohandas on the sidelines of a conference told reporters that “All ports have suffered huge losses of business, including New Mangalore, Ennore, Visakhapatnam, Paradip and Mormugao.”
Mr Mohandas said ports are dependent on cargo and iron ore used to contribute significantly in ports’ business.
He also added that mining and exports policies did not come under Shipping Ministry’s purview when asked whether the ministry is taking any step in this regard.
The iron ore exports from the country last fiscal came down to 97.64 million tonne while in the first eight months of the current fiscal, exports dipped by a little over 28% to 40 million tonne vis a vis the corresponding period last fiscal.
Apart from this, upward revision in export duty to 30%, the miners said that will result in total shipments unlikely to exceed 50 million tonne in the current fiscal, which is further bound to impact the ports.
(Sourced from PTI)
Wednesday, January 18, 2012
Orissa blocks its ore export from two Andhra ports
Wednesday, 18 January 2012
Orissa has continued to stop its iron ore exports from two ports in Andhra Pradesh on concerns over their mechanism to check illegal shipments, an official said yesterday. The state stopped issuing permits for ore exports through the Gangavaram and Kakinada ports early last month after they failed to provide their operational details.
"Gangavaram has in the meanwhile given us the required information and we are examining that. But Kakinada has not responded," state Steel and Mines Secretary Manoj Ahuja said.
Iron ore mined in the state is exported from ports in many states, including Andhra Pradesh and West Bengal. Orissa has initiated several steps to check illegal mining and export of iron ore from the state after some politicians alleged in July 2009 that some mines were operating without licences.
Source: IANS
Orissa has continued to stop its iron ore exports from two ports in Andhra Pradesh on concerns over their mechanism to check illegal shipments, an official said yesterday. The state stopped issuing permits for ore exports through the Gangavaram and Kakinada ports early last month after they failed to provide their operational details.
"Gangavaram has in the meanwhile given us the required information and we are examining that. But Kakinada has not responded," state Steel and Mines Secretary Manoj Ahuja said.
Iron ore mined in the state is exported from ports in many states, including Andhra Pradesh and West Bengal. Orissa has initiated several steps to check illegal mining and export of iron ore from the state after some politicians alleged in July 2009 that some mines were operating without licences.
Source: IANS
Tuesday, December 27, 2011
Indian steel ministry seeks decision to stop NMDC iron ore
Tuesday, 27 Dec 2011
The Indian Express reported that armed with the CAG’s observations that NMDC’s iron ore exports to Japanese Steel Mills and South Korea was needless in view of growing domestic demand, the Indian steel ministry has decided to ask the union cabinet to reconsider its decision on mandating NMDC to export the mineral.
The official quoted the Chattisgarh chief minister as saying that “The chief minister said if NMDC had not exported ore to these two nations, at least 3 million tonne of additional iron ore would have been available to the state’s ore-starved sponge iron units.”
The official said that “Actually, we also have been opposing these exports from the beginning and had already conveyed our concerns to the commerce ministry, at whose behest the cabinet had okayed NMDC’s continuation of exports (till 2014). We will tell firmly that exports to these two nations are unsustainable at long term prices as it amounted to subsidizing their steel production.”
The official added that “We have decided to approach the Union Cabinet soon to re consider its decision to mandate NMDC to renew its long-term agreements with these two nations, which is bereft of any logic.”
The Comptroller and Auditor General in its recent observations to the steel ministry, had said that NMDC has been mandated to exports iron ore to Japanese steel mills and South Korea but made to overlook the domestic demand for the mineral. The CAG has questioned the mandate.
The move also comes close on the heels of the I-T department who hit out the Navratna company for losing substantial revenues by exporting to Japanese steel mills on long term prices and not through a more viable spot prices. A senior steel ministry official told The Indian Express that “The Income Tax Department has also questioned NMDC’s exports to these two countries on long term prices. It says the PSU has incurred substantial financial losses by not selling the mineral on spot prices.”
(Sourced from www.indianexpress.com)
The Indian Express reported that armed with the CAG’s observations that NMDC’s iron ore exports to Japanese Steel Mills and South Korea was needless in view of growing domestic demand, the Indian steel ministry has decided to ask the union cabinet to reconsider its decision on mandating NMDC to export the mineral.
The official quoted the Chattisgarh chief minister as saying that “The chief minister said if NMDC had not exported ore to these two nations, at least 3 million tonne of additional iron ore would have been available to the state’s ore-starved sponge iron units.”
The official said that “Actually, we also have been opposing these exports from the beginning and had already conveyed our concerns to the commerce ministry, at whose behest the cabinet had okayed NMDC’s continuation of exports (till 2014). We will tell firmly that exports to these two nations are unsustainable at long term prices as it amounted to subsidizing their steel production.”
The official added that “We have decided to approach the Union Cabinet soon to re consider its decision to mandate NMDC to renew its long-term agreements with these two nations, which is bereft of any logic.”
The Comptroller and Auditor General in its recent observations to the steel ministry, had said that NMDC has been mandated to exports iron ore to Japanese steel mills and South Korea but made to overlook the domestic demand for the mineral. The CAG has questioned the mandate.
The move also comes close on the heels of the I-T department who hit out the Navratna company for losing substantial revenues by exporting to Japanese steel mills on long term prices and not through a more viable spot prices. A senior steel ministry official told The Indian Express that “The Income Tax Department has also questioned NMDC’s exports to these two countries on long term prices. It says the PSU has incurred substantial financial losses by not selling the mineral on spot prices.”
(Sourced from www.indianexpress.com)
Monday, December 26, 2011
Orissa likely to go Bellary way
Monday, 26 Dec 2011
ET reported that Karnataka scenario may now be repeated in Orissa, which produces a third of the country's iron ore and where a state government team is investigating cases of mining contractors taking out and shipping ore illegally.
The culprit in both cases seems to be the abuse of 'raising contracts', agreements between mine owners and operators permitting an individual or a group of individuals owning a mine to outsource the extraction and sale of ore to a third party with expertise.
A pattern similar to Karnataka has been now noted by Orissa officials in the state. Rule 37 of the Mineral Concessions Rules, 1968, permit raising contracts but without the transfer of ownership and financial control of the mine. But in Keonjhar and other districts of Orissa, that is exactly what seems to have happened. The state government suspects some contractors took over mines and shared profits with the original lease holder.
A senior Orissa official of the mines ministry told ET recently that "Our team has submitted a report on eight such mines which we are studying. We have sent notices to three miners and will be auditing some more.”
Eight more are to be scrutinized for similar violations.
One of Keonjhar's older miners said that “It suits lease holders who have been living far from the mines. They could make money without lifting a finger.”
The Justice Shah Commission, which is examining the illegalities in iron ore and manganese mining across the country, also visited some of these mines during its recent trip to the Joda-Barbil area in Keonjhar. The Shah Commission officials specifically wanted to know the nature of the mine's arrangement with the contractor and the question of control.
(Sourced from ET)
ET reported that Karnataka scenario may now be repeated in Orissa, which produces a third of the country's iron ore and where a state government team is investigating cases of mining contractors taking out and shipping ore illegally.
The culprit in both cases seems to be the abuse of 'raising contracts', agreements between mine owners and operators permitting an individual or a group of individuals owning a mine to outsource the extraction and sale of ore to a third party with expertise.
A pattern similar to Karnataka has been now noted by Orissa officials in the state. Rule 37 of the Mineral Concessions Rules, 1968, permit raising contracts but without the transfer of ownership and financial control of the mine. But in Keonjhar and other districts of Orissa, that is exactly what seems to have happened. The state government suspects some contractors took over mines and shared profits with the original lease holder.
A senior Orissa official of the mines ministry told ET recently that "Our team has submitted a report on eight such mines which we are studying. We have sent notices to three miners and will be auditing some more.”
Eight more are to be scrutinized for similar violations.
One of Keonjhar's older miners said that “It suits lease holders who have been living far from the mines. They could make money without lifting a finger.”
The Justice Shah Commission, which is examining the illegalities in iron ore and manganese mining across the country, also visited some of these mines during its recent trip to the Joda-Barbil area in Keonjhar. The Shah Commission officials specifically wanted to know the nature of the mine's arrangement with the contractor and the question of control.
(Sourced from ET)
Monday, December 12, 2011
Orissa stops iron ore exports permits to 2 ports
Monday, Dec12, 2011
BHUBANESWAR (Reuters) - Orissa has stopped issuing iron ore export permits for cargoes shipped via two ports in Andhra Pradesh, Orissa mines minister told Reuters.
"The Gangavaram and Kakinada ports did not cooperate" with the state mines and steel department's queries on the volume of the ore exported through these ports and the mechanism they followed to prevent illegal exports, minister Raghunath Mohanty said.
The state government had sought such details from all the ports that exported iron ore from the state.
"We will not issue the permits until they (the port authorities) submit details and tell us what system they have," a senior official of the steel and mines department, who did not want to be named, told Reuters.
On the total export of 35 million tonnes iron ore from the country, 2 million tonnes were shipped through these ports in the first seven months of the current fiscal year ending March, data from the Federation of Indian Minerals and Industry, a trade body, showed.
(sourced Reuters)
BHUBANESWAR (Reuters) - Orissa has stopped issuing iron ore export permits for cargoes shipped via two ports in Andhra Pradesh, Orissa mines minister told Reuters.
"The Gangavaram and Kakinada ports did not cooperate" with the state mines and steel department's queries on the volume of the ore exported through these ports and the mechanism they followed to prevent illegal exports, minister Raghunath Mohanty said.
The state government had sought such details from all the ports that exported iron ore from the state.
"We will not issue the permits until they (the port authorities) submit details and tell us what system they have," a senior official of the steel and mines department, who did not want to be named, told Reuters.
On the total export of 35 million tonnes iron ore from the country, 2 million tonnes were shipped through these ports in the first seven months of the current fiscal year ending March, data from the Federation of Indian Minerals and Industry, a trade body, showed.
(sourced Reuters)
Saturday, December 10, 2011
Mines minister denies plans to ban iron ore export
Saturday, 10 Dec 2011
Mr Dinsha Patel minister of state for mines in a written reply to a question in Lok Sabha said that “Recently State Government of Karnataka and State Government of Orissa had, inter-alia, suggested ban on export of iron ore with a view to conserve minerals and allow value addition in the country. Demand for ban on iron ore is not new and it has arisen in the past out of concerns on depletion of ore due to exports, need to conserve the ore for future domestic requirement, leveraging domestic value addition capacity and inflationary impact of exports on domestic pricing.
These concerns had been duly considered by the Government and it was felt that these fears of depletion were misplaced and that though the Steel Industry needed protection, ban or cap on exports would not be the correct instrument, and the appropriate mechanism to control exports would lie in the fiscal measures.
It was also held that this position should be revisited after 10 years. The Government is also of the opinion that while exports of iron ore has increased in the last few years, these exports largely consist of Iron ore Fines(approximately 80%) which do not have sufficient domestic market, which if allowed to accumulate in the mines could pose serious environmental hazard apart from restricting production of Iron ore.”
Mr Dinsha Patel minister of state for mines in a written reply to a question in Lok Sabha said that “Recently State Government of Karnataka and State Government of Orissa had, inter-alia, suggested ban on export of iron ore with a view to conserve minerals and allow value addition in the country. Demand for ban on iron ore is not new and it has arisen in the past out of concerns on depletion of ore due to exports, need to conserve the ore for future domestic requirement, leveraging domestic value addition capacity and inflationary impact of exports on domestic pricing.
These concerns had been duly considered by the Government and it was felt that these fears of depletion were misplaced and that though the Steel Industry needed protection, ban or cap on exports would not be the correct instrument, and the appropriate mechanism to control exports would lie in the fiscal measures.
It was also held that this position should be revisited after 10 years. The Government is also of the opinion that while exports of iron ore has increased in the last few years, these exports largely consist of Iron ore Fines(approximately 80%) which do not have sufficient domestic market, which if allowed to accumulate in the mines could pose serious environmental hazard apart from restricting production of Iron ore.”
Thursday, November 17, 2011
Orissa CM reiterates demand for ban on iron ore exports
Thursday, 17 Nov 2011
BS reported that Odisha has again sought an immediate ban on exports of the mineral ore, saying such a move would bring down prices of ore and help regulate mining activities.
The state chief minister Mr Naveen Patnaik has reiterated his demand for ban on iron ore exports, seeking intervention of prime minister Dr Manmohan Singh on the matter.
Mr Patnaik said in his letter to the PM that “The boom in iron ore prices in the last decade has created perverse incentives for mining activities to be carried out in an unregulated manner. A ban on the export of iron ore should be immediately imposed. This will not only bring down domestic prices of iron ore but also encourage local industries to invest in technologies to utilize the iron ore prices presently being exported, besides ensuring that mining activities are regulated and sustainable.”
He said “The ban on iron ore exports is necessary as the demand for steel and its production in the country are both expected to grow at an annual rate of 10% or more on an average in the coming years.”
Mr Patnaik had earlier urged the Prime Minister to announce a ban on iron ore exports and had also raised this demand at the meeting of the National Development Council held on October 22.
(Sourced from BS)
BS reported that Odisha has again sought an immediate ban on exports of the mineral ore, saying such a move would bring down prices of ore and help regulate mining activities.
The state chief minister Mr Naveen Patnaik has reiterated his demand for ban on iron ore exports, seeking intervention of prime minister Dr Manmohan Singh on the matter.
Mr Patnaik said in his letter to the PM that “The boom in iron ore prices in the last decade has created perverse incentives for mining activities to be carried out in an unregulated manner. A ban on the export of iron ore should be immediately imposed. This will not only bring down domestic prices of iron ore but also encourage local industries to invest in technologies to utilize the iron ore prices presently being exported, besides ensuring that mining activities are regulated and sustainable.”
He said “The ban on iron ore exports is necessary as the demand for steel and its production in the country are both expected to grow at an annual rate of 10% or more on an average in the coming years.”
Mr Patnaik had earlier urged the Prime Minister to announce a ban on iron ore exports and had also raised this demand at the meeting of the National Development Council held on October 22.
(Sourced from BS)
Monday, November 14, 2011
FIMI urges not to impose blanket ban on iron ore export
Monday, 14 Nov 2011
The Federation of Indian Mineral Industries has urged the Indian government not to impose a blanket ban on the export of iron ore, as it would affect India's steel industry and result in the closure of captive mines.
Mr RK Bansal FIMI secretary in the letter written to Joint Plant Committee, Union Ministry of Steel, on November 4, has said that there should be no blanket ban or qualitative restriction on ore exports.
FIMI has argued that due to the discontinuation of mining, further exploration would also come to the halt and therefore no further addition to reserves and resources can happen.
Mr Bansal said that "A ban on export will mean that most of the non-captive mines will get closed with consequent adverse impacts on local economy, employment as well as state revenues.”
He said "With the discontinuance of non-captive production, the availability of lumps and high grade fines to the steel industry will get reduced, thus proving counter-productive to the interests of the steel industry.”
The federation has also demanded that export duty should not be imposed as exports provide cushion against fluctuation in demand and prices in the domestic market and vice versa.
It has said that there should be no captive mines allowed to any steel plant, since the domestic iron ore production is already surplus to the domestic demand and will continue to be so for next few years.
FIMI has urged the centre to develop iron ore mining as a standalone mining industry, separate from steel industry, so that, both could work at arm's length and benefit from each other's strength and innovations rather than take shelter behind the safety net available.
(Sourced from ET)
The Federation of Indian Mineral Industries has urged the Indian government not to impose a blanket ban on the export of iron ore, as it would affect India's steel industry and result in the closure of captive mines.
Mr RK Bansal FIMI secretary in the letter written to Joint Plant Committee, Union Ministry of Steel, on November 4, has said that there should be no blanket ban or qualitative restriction on ore exports.
FIMI has argued that due to the discontinuation of mining, further exploration would also come to the halt and therefore no further addition to reserves and resources can happen.
Mr Bansal said that "A ban on export will mean that most of the non-captive mines will get closed with consequent adverse impacts on local economy, employment as well as state revenues.”
He said "With the discontinuance of non-captive production, the availability of lumps and high grade fines to the steel industry will get reduced, thus proving counter-productive to the interests of the steel industry.”
The federation has also demanded that export duty should not be imposed as exports provide cushion against fluctuation in demand and prices in the domestic market and vice versa.
It has said that there should be no captive mines allowed to any steel plant, since the domestic iron ore production is already surplus to the domestic demand and will continue to be so for next few years.
FIMI has urged the centre to develop iron ore mining as a standalone mining industry, separate from steel industry, so that, both could work at arm's length and benefit from each other's strength and innovations rather than take shelter behind the safety net available.
(Sourced from ET)
Thursday, October 27, 2011
Indian state of Orissa limits supply of iron ore
Thu, 27 October 2011
Raghunath Mohanty, the minister of steel and mines of the eastern Indian state of Orissa, has said that the state government has issued a notice to all the producers, traders and exporters of the Joda and Barbil mines in the Keonjhar district to stop supplying iron ore. The government of Orissa has been tracking companies who have been mining and exporting illegally. The Orissa authorities have asked the companies in question to submit their audited balance sheets along with procurement details for the last four years.
Following the mining ban in Karnataka state and restrictions on iron ore supply from Goa, most domestic steel mills turned to purchase iron ore from the state of Orissa. Analysts state that the action by the Orissa government will affect steel companies which buy iron ore from Orissa state, such as JSW Steel and Tata Steel.
The state of Orissa produces about 75 million metric tons of iron ore fines and lumps annually.
Tags: iron ore , India , raw mat , Indian Subcon , South Asia , mining , production
sourced steelorbis
Raghunath Mohanty, the minister of steel and mines of the eastern Indian state of Orissa, has said that the state government has issued a notice to all the producers, traders and exporters of the Joda and Barbil mines in the Keonjhar district to stop supplying iron ore. The government of Orissa has been tracking companies who have been mining and exporting illegally. The Orissa authorities have asked the companies in question to submit their audited balance sheets along with procurement details for the last four years.
Following the mining ban in Karnataka state and restrictions on iron ore supply from Goa, most domestic steel mills turned to purchase iron ore from the state of Orissa. Analysts state that the action by the Orissa government will affect steel companies which buy iron ore from Orissa state, such as JSW Steel and Tata Steel.
The state of Orissa produces about 75 million metric tons of iron ore fines and lumps annually.
Tags: iron ore , India , raw mat , Indian Subcon , South Asia , mining , production
sourced steelorbis
Monday, August 22, 2011
Sesa Goa hits 52-week low on a likely mining ban in Chitradurga, Tumkur
Mon,Aug 22, 2011
Sesa Goa slipped 4.85% at Rs. 211.75 at 11:03 IST on BSE on reports a panel appointed by the Supreme Court has recommended a ban on mining in iron ore-rich areas of Tumkur and Chitradurga in Karnataka.
Meanwhile, the BSE Sensex was down 31.10 points, or 0.19%, to 16,105.82.
On BSE, 2.59 lakh shares were traded in the counter as against an average daily volume of 4.08 lakh shares in the past one quarter.
The stock hit a low of Rs. 209.60 so far during the day, which is also a 52-week low for the counter. The stock hit a high of Rs. 215 so far during the day. The stock had hit a 52-week high of Rs. 383.50 on 15 October 2010.
The stock had underperformed the market over the past one month until 19 August 2011, sliding 23.29% compared with the Sensex's 13.47% fall. The scrip had also underperformed the market in past one quarter, tumbling 24.81% as against 11.02% decline in the Sensex.
India's largest private sector iron ore exporter has an equity capital of Rs. 86.91 crore. Face value per share is Re 1.
According to reports, the Supreme Court's environment panel, Central Empowered Committee (CEC), on Friday, 19 August 2011, concurred with the Karnataka Lokayukta to report rampant illegal iron ore mining in Chitradurga and Tumkur districts and recommended a complete ban on private mining.
Sesa Goa has a mine is Chitradurga. Earlier this month, Sesa Goa's managing director, PK Mukherjee was quoted by the media as saying that the company is targeting six million tonne per annum (MTPA) of iron ore production from Karnataka in the current year.
Submitting the CEC's report to a bench of Chief Justice S H Kapadia and Justices Aftab Alam and Swatanter Kumar, adviser A D N Rao reportedly said the adverse impact on environment in Chitradurga and Tumkur districts was identical to the one witnessed in Bellary and advocated controlled mining as had been ordered by the apex court in Bellary.
On 29 July 2011, the apex Court had suspended all mining activities in Bellary district of Karnataka, observing that extraction of iron ore would not be allowed at the cost of environment degradation.
Reports suggest that the court has issued notice to the Karnataka government and sought its response within a week to the CEC's recommendation that mining activity be completely banned in Chitradurga and Tumkur districts before putting in place an interim arrangement on the lines of the one in Bellary district, where mining is done by public sector undertakings meant to meet the requirement of the domestic steel industry.
Sesa Goa's consolidated net profit slumped 35.4% to Rs. 840.59 crore on 12.5% fall in net sales to Rs. 2094.74 crore in Q1 June 2011 over Q1 June 2010.
Sesa Goa is India's largest producer and exporter of iron ore in the private sector and is on course to be in the league of top four iron ore producing companies in the world. Apart from iron ore it also produces pig iron and metallurgical coke.
Sesa Goa slipped 4.85% at Rs. 211.75 at 11:03 IST on BSE on reports a panel appointed by the Supreme Court has recommended a ban on mining in iron ore-rich areas of Tumkur and Chitradurga in Karnataka.
Meanwhile, the BSE Sensex was down 31.10 points, or 0.19%, to 16,105.82.
On BSE, 2.59 lakh shares were traded in the counter as against an average daily volume of 4.08 lakh shares in the past one quarter.
The stock hit a low of Rs. 209.60 so far during the day, which is also a 52-week low for the counter. The stock hit a high of Rs. 215 so far during the day. The stock had hit a 52-week high of Rs. 383.50 on 15 October 2010.
The stock had underperformed the market over the past one month until 19 August 2011, sliding 23.29% compared with the Sensex's 13.47% fall. The scrip had also underperformed the market in past one quarter, tumbling 24.81% as against 11.02% decline in the Sensex.
India's largest private sector iron ore exporter has an equity capital of Rs. 86.91 crore. Face value per share is Re 1.
According to reports, the Supreme Court's environment panel, Central Empowered Committee (CEC), on Friday, 19 August 2011, concurred with the Karnataka Lokayukta to report rampant illegal iron ore mining in Chitradurga and Tumkur districts and recommended a complete ban on private mining.
Sesa Goa has a mine is Chitradurga. Earlier this month, Sesa Goa's managing director, PK Mukherjee was quoted by the media as saying that the company is targeting six million tonne per annum (MTPA) of iron ore production from Karnataka in the current year.
Submitting the CEC's report to a bench of Chief Justice S H Kapadia and Justices Aftab Alam and Swatanter Kumar, adviser A D N Rao reportedly said the adverse impact on environment in Chitradurga and Tumkur districts was identical to the one witnessed in Bellary and advocated controlled mining as had been ordered by the apex court in Bellary.
On 29 July 2011, the apex Court had suspended all mining activities in Bellary district of Karnataka, observing that extraction of iron ore would not be allowed at the cost of environment degradation.
Reports suggest that the court has issued notice to the Karnataka government and sought its response within a week to the CEC's recommendation that mining activity be completely banned in Chitradurga and Tumkur districts before putting in place an interim arrangement on the lines of the one in Bellary district, where mining is done by public sector undertakings meant to meet the requirement of the domestic steel industry.
Sesa Goa's consolidated net profit slumped 35.4% to Rs. 840.59 crore on 12.5% fall in net sales to Rs. 2094.74 crore in Q1 June 2011 over Q1 June 2010.
Sesa Goa is India's largest producer and exporter of iron ore in the private sector and is on course to be in the league of top four iron ore producing companies in the world. Apart from iron ore it also produces pig iron and metallurgical coke.
Tuesday, August 16, 2011
Steps taken by Indian government to curb iron ore exports
Tuesday, 16 Aug 2011
India's iron ore exports, which fell for the first time in a decade last year, could halve over the next five years as the country feeds the expansion of its steel industry.
Following is a timeline of key developments in India's iron ore sector since Karnataka, the country's second-largest producer, introduced its shipments ban:
July 26th 2010
Karnataka, ruled by the opposition Bharatiya Janata Party, bans shipments of iron ore. The state government had faced pressure from the ruling Congress led central government to clamp down on illegal mining. Exporters in the state subsequently challenged the ban.
September
Iron ore exports post their sharpest monthly fall in nearly two years after Karnataka's ban and slow China demand. Exports drop 47% from a year earlier to 3.03 million tonnes.
November 19
Karnataka's high court upholds the ban on exports.
November 23
Iron ore miners in the state say they will challenge the ban in the Supreme Court.
January 11th 2011
Top iron ore producing Orissa says it is considering seeking a ban on exports of the key raw material.
January 20
The Supreme Court delays its decision on the ban to mid February.
January 25
Indian railways announce an increase in freight costs on iron ore for export by 50% to INR 1,500 per tonne.
January 29
India's Multi Commodity Exchange and Indian Commodity Exchange launch the world's first iron ore futures contracts. But a ban on foreign players means liquidity is low.
February 10
Steel Authority of India wins environmental approval for its own iron ore mines in Jharkhand. SAIL says it will be operating in three years and will be key to its future iron ore supply.
February 11
The Supreme Court again adjourns its hearing on the Karnataka ban, this time to April 4.
February 18
Chhattisgarh joins Orissa in seeking central government approval to ban iron ore exports.
February 28
India hikes export duty on iron ore to 20% from 5% for fines and from 15 percent for lumps in its annual budget.
March 3
Freight rates are hiked again, this time by 100 rupees per tonne to INR 1,600.
March 30
Indian Railways says it will impose a "busy season" charge of 7 percent on iron ore freight rates from April 1 to June 30 and from Oct. 1 to March 31. The charge will equate to about INR 150 to INR 200 per tonne, one trader says.
April 5
Supreme Court orders Karnataka state to lift ban on iron ore shipments from April 20.
June 27
Iron ore exporter Mineral Enterprises Ltd says to call on Supreme Court to uphold lifting of the Karnataka ban which has been delayed by an inquiry into illegal mining.
July 27
An independent led inquiry implicates BS Yediyurappa chief minister of Karnataka, in a USD 3.6 billion illegal iron ore mining scandal.
July 29
Supreme Court imposes an interim ban on mining in the district of Bellary, a key iron-ore rich region in Karnataka, on concerns of environment degradation.
July 31
Yediyurappa resigns as Karnataka chief minister.
August 5
Supreme Court partially lifts iron ore mining ban in Bellary district, allowing state run NMDC to mine up to 1 million tonnes a month from Aug. 6.
(Sourced from Reuters)
India's iron ore exports, which fell for the first time in a decade last year, could halve over the next five years as the country feeds the expansion of its steel industry.
Following is a timeline of key developments in India's iron ore sector since Karnataka, the country's second-largest producer, introduced its shipments ban:
July 26th 2010
Karnataka, ruled by the opposition Bharatiya Janata Party, bans shipments of iron ore. The state government had faced pressure from the ruling Congress led central government to clamp down on illegal mining. Exporters in the state subsequently challenged the ban.
September
Iron ore exports post their sharpest monthly fall in nearly two years after Karnataka's ban and slow China demand. Exports drop 47% from a year earlier to 3.03 million tonnes.
November 19
Karnataka's high court upholds the ban on exports.
November 23
Iron ore miners in the state say they will challenge the ban in the Supreme Court.
January 11th 2011
Top iron ore producing Orissa says it is considering seeking a ban on exports of the key raw material.
January 20
The Supreme Court delays its decision on the ban to mid February.
January 25
Indian railways announce an increase in freight costs on iron ore for export by 50% to INR 1,500 per tonne.
January 29
India's Multi Commodity Exchange and Indian Commodity Exchange launch the world's first iron ore futures contracts. But a ban on foreign players means liquidity is low.
February 10
Steel Authority of India wins environmental approval for its own iron ore mines in Jharkhand. SAIL says it will be operating in three years and will be key to its future iron ore supply.
February 11
The Supreme Court again adjourns its hearing on the Karnataka ban, this time to April 4.
February 18
Chhattisgarh joins Orissa in seeking central government approval to ban iron ore exports.
February 28
India hikes export duty on iron ore to 20% from 5% for fines and from 15 percent for lumps in its annual budget.
March 3
Freight rates are hiked again, this time by 100 rupees per tonne to INR 1,600.
March 30
Indian Railways says it will impose a "busy season" charge of 7 percent on iron ore freight rates from April 1 to June 30 and from Oct. 1 to March 31. The charge will equate to about INR 150 to INR 200 per tonne, one trader says.
April 5
Supreme Court orders Karnataka state to lift ban on iron ore shipments from April 20.
June 27
Iron ore exporter Mineral Enterprises Ltd says to call on Supreme Court to uphold lifting of the Karnataka ban which has been delayed by an inquiry into illegal mining.
July 27
An independent led inquiry implicates BS Yediyurappa chief minister of Karnataka, in a USD 3.6 billion illegal iron ore mining scandal.
July 29
Supreme Court imposes an interim ban on mining in the district of Bellary, a key iron-ore rich region in Karnataka, on concerns of environment degradation.
July 31
Yediyurappa resigns as Karnataka chief minister.
August 5
Supreme Court partially lifts iron ore mining ban in Bellary district, allowing state run NMDC to mine up to 1 million tonnes a month from Aug. 6.
(Sourced from Reuters)
Monday, August 15, 2011
Keeping more iron ore at home, India exports seen halved
Mon Aug15, 2011
By Manolo Serapio Jr and Siddesh Mayenkar
SINGAPORE/MUMBAI (Reuters) - India's iron ore exports, which fell for the first time in a decade last year, could halve over the next five years as the country feeds the expansion of its steel industry.
Lower shipments from the world's No. 3 exporter should help bolster prices that have already more than trebled from late 2008, as massive increases in global supply are only expected to come through by 2015 and demand from top consumer China rises.
"Indian exports are in a structural decline as resource nationalism becomes a bigger driver behind policy. The policy is definitely not encouraging exports," said Graeme Train, commodity analyst at Macquarie in Shanghai.
In a bid to curb overseas sales, India has raised freight rates and quadrupled export taxes on iron ore fines, the sandy material that typically contains 55-65 percent iron and which comprises around 70 percent of its annual output of about 200 million tonnes.
India's iron ore output and exports,
Iron ore exports from India fell 17 percent to 97.6 million tonnes in the year to March, largely due to a ban on shipments from the key producing state of Karnataka.
Analysts in a Reuters poll forecast another drop to eight-year lows this year on increased costs and a delay in resumption of shipments from Karnataka, source of around a quarter of India's exports.
Tight Indian supplies and booming Chinese demand lifted spot iron ore prices to record highs above $190 a tonne in mid-February. They are currently trading near $176.
EXPANDING STEEL SECTOR
The world's fifth-largest steel producer, India is aiming to lift output to 120 million tonnes by the end of 2012 from nearly 67 million tonnes in 2010, as the likes of steel giants ArcelorMittal and POSCO expand their reach into Asia's third-largest economy.
India is looking at 8.2 percent growth this fiscal year, after expanding 8.5 percent last year, underscoring the need to boost domestic steel output and consumption of iron ore.
With the expansion in its steel sector, the country's iron ore exports are forecast to fall to roughly half of the 97.6 million tonnes shipped in the last fiscal year by the year to March 2016, said Gunmeet Singh, analyst for CRU in Mumbai.
India's traditional steel blast furnaces can use only iron ore lumps, but there is a growing move among steelmakers to invest in more pelletizing and sintering plants that can take the iron ore fines now mostly exported to China.
Singh estimates that the country's pelletizing capacity will triple to 90 million tonnes in five years and its sintering capacity will increase 55-60 percent from 53 million tonnes.
"In many ways the efforts to prevent exports of iron ore are more to support the domestic steel industry which will benefit from much lower raw material costs," said Christopher Ellis, analyst with Metal Bulletin.
While land acquisitions remain a big hurdle that could disrupt India's plans, with protests continuing against POSCO's planned $12 billion steel mill that was meant to start producing this year, there is a pending bill in parliament aimed at boosting payouts to poor villagers for industrial projects developed on farmland.
MARGIN SQUEEZE, KARNATAKA FREEZE
Apart from imposing higher taxes to stop iron ore exports, India also hiked freight rates twice this year, making carriage costs for exports five times more expensive than those for ore for local consumption.
The increased taxes and tariffs pushed the average cost for Indian iron ore to $100 per tonne, more than double the production cost in Australia and Brazil, said Train.
"That would put Indian material at the top of the cost curve this year. They're almost better off selling into the domestic market," said Train.
The higher cost slashed margins of producers, after taking out handling and shipping fees.
"Before the tax hike, miners earned $40 per tonne, but after the tax incursions the margins have diminished to $10-$20," said Dhruv Goel, managing director at Orissa-based Steel Mint.
"The middle man hardly gets $1 (per tonne)."
Indian exports also suffered from a ban on shipments from the iron-ore rich state of Karnataka, source of around a quarter of the country's annual exports, from July 2010, as part of the state's crackdown on illegal mining.
The Supreme Court ordered the ban lifted in April but that order has yet to be carried out with the state government citing procedural delays as it installs monitoring and tracking systems. Political infighting may further progress.
Gavin Montgomery, iron ore analyst at Wood Mackenzie, said he expects Indian shipments to fall to 65 million tonnes by 2015, prompting big suppliers Australia and Brazil to sell more to China and non-traditional exporters to boost shipments.
The burden of producing more to feed China's demand rests on big suppliers Australia and Brazil.
Brazil's Vale and Australia's Rio Tinto and BHP Billiton, which together control around two-thirds of global seaborne supply, are looking to boost their collective output by half to around 1 billion tonnes by 2015.
That will equal China's import demand by then as high production costs and low-quality iron ore reserves boost its purchases, according to estimates from Wood Mackenzie.
"With iron ore prices staying around $180 a tonne, the supply can come from a lot of different sources. If Indian supply continues to disappoint, we will see continued reliance on both traditional and non-traditional suppliers," said Montgomery.
($1 = 45.255 rupees)
By Manolo Serapio Jr and Siddesh Mayenkar
SINGAPORE/MUMBAI (Reuters) - India's iron ore exports, which fell for the first time in a decade last year, could halve over the next five years as the country feeds the expansion of its steel industry.
Lower shipments from the world's No. 3 exporter should help bolster prices that have already more than trebled from late 2008, as massive increases in global supply are only expected to come through by 2015 and demand from top consumer China rises.
"Indian exports are in a structural decline as resource nationalism becomes a bigger driver behind policy. The policy is definitely not encouraging exports," said Graeme Train, commodity analyst at Macquarie in Shanghai.
In a bid to curb overseas sales, India has raised freight rates and quadrupled export taxes on iron ore fines, the sandy material that typically contains 55-65 percent iron and which comprises around 70 percent of its annual output of about 200 million tonnes.
India's iron ore output and exports,
Iron ore exports from India fell 17 percent to 97.6 million tonnes in the year to March, largely due to a ban on shipments from the key producing state of Karnataka.
Analysts in a Reuters poll forecast another drop to eight-year lows this year on increased costs and a delay in resumption of shipments from Karnataka, source of around a quarter of India's exports.
Tight Indian supplies and booming Chinese demand lifted spot iron ore prices to record highs above $190 a tonne in mid-February. They are currently trading near $176.
EXPANDING STEEL SECTOR
The world's fifth-largest steel producer, India is aiming to lift output to 120 million tonnes by the end of 2012 from nearly 67 million tonnes in 2010, as the likes of steel giants ArcelorMittal and POSCO expand their reach into Asia's third-largest economy.
India is looking at 8.2 percent growth this fiscal year, after expanding 8.5 percent last year, underscoring the need to boost domestic steel output and consumption of iron ore.
With the expansion in its steel sector, the country's iron ore exports are forecast to fall to roughly half of the 97.6 million tonnes shipped in the last fiscal year by the year to March 2016, said Gunmeet Singh, analyst for CRU in Mumbai.
India's traditional steel blast furnaces can use only iron ore lumps, but there is a growing move among steelmakers to invest in more pelletizing and sintering plants that can take the iron ore fines now mostly exported to China.
Singh estimates that the country's pelletizing capacity will triple to 90 million tonnes in five years and its sintering capacity will increase 55-60 percent from 53 million tonnes.
"In many ways the efforts to prevent exports of iron ore are more to support the domestic steel industry which will benefit from much lower raw material costs," said Christopher Ellis, analyst with Metal Bulletin.
While land acquisitions remain a big hurdle that could disrupt India's plans, with protests continuing against POSCO's planned $12 billion steel mill that was meant to start producing this year, there is a pending bill in parliament aimed at boosting payouts to poor villagers for industrial projects developed on farmland.
MARGIN SQUEEZE, KARNATAKA FREEZE
Apart from imposing higher taxes to stop iron ore exports, India also hiked freight rates twice this year, making carriage costs for exports five times more expensive than those for ore for local consumption.
The increased taxes and tariffs pushed the average cost for Indian iron ore to $100 per tonne, more than double the production cost in Australia and Brazil, said Train.
"That would put Indian material at the top of the cost curve this year. They're almost better off selling into the domestic market," said Train.
The higher cost slashed margins of producers, after taking out handling and shipping fees.
"Before the tax hike, miners earned $40 per tonne, but after the tax incursions the margins have diminished to $10-$20," said Dhruv Goel, managing director at Orissa-based Steel Mint.
"The middle man hardly gets $1 (per tonne)."
Indian exports also suffered from a ban on shipments from the iron-ore rich state of Karnataka, source of around a quarter of the country's annual exports, from July 2010, as part of the state's crackdown on illegal mining.
The Supreme Court ordered the ban lifted in April but that order has yet to be carried out with the state government citing procedural delays as it installs monitoring and tracking systems. Political infighting may further progress.
Gavin Montgomery, iron ore analyst at Wood Mackenzie, said he expects Indian shipments to fall to 65 million tonnes by 2015, prompting big suppliers Australia and Brazil to sell more to China and non-traditional exporters to boost shipments.
The burden of producing more to feed China's demand rests on big suppliers Australia and Brazil.
Brazil's Vale and Australia's Rio Tinto and BHP Billiton, which together control around two-thirds of global seaborne supply, are looking to boost their collective output by half to around 1 billion tonnes by 2015.
That will equal China's import demand by then as high production costs and low-quality iron ore reserves boost its purchases, according to estimates from Wood Mackenzie.
"With iron ore prices staying around $180 a tonne, the supply can come from a lot of different sources. If Indian supply continues to disappoint, we will see continued reliance on both traditional and non-traditional suppliers," said Montgomery.
($1 = 45.255 rupees)
Sunday, August 14, 2011
POSCO agrees for not exporting iron ore
Sunday, 14 Aug 2011
BS reported that even as POSCO India is yet to submit a written response on the draft prepared for renewal of MoU with the Orissa government, the company is understood to have raised certain reservations over the omission of the iron ore swapping clause in the revised pact.
While POSCO has verbally agreed not to export iron ore from Orissa, the steel maker has requested the state government to allow it to swap high alumina content iron ore found in Khandadhar mines with high grade ore of any other firm including state owned Orissa Mining Corporation within the state.
A mines department official familiar with the development said that "POSCO India is yet to submit its written reply to our draft MoU. However, the company, during discussions with the state government officials, has agreed to our other conditions including adhering to the employment clause and promoting ancillary industries around the mother plant.”
The Orissa’s state chief secretary Mr BK Patnaik maintained that POSCO India is yet to submit any written response in connection with the renewal of the MoU that lapsed on June 21 last year.
Despite commitments from top officials of the state government, the renewal of MoU with POSCO India had suffered an inordinate delay. The state government had jumped three of its stipulated deadlines in the road to renewal of the pact.
(Sourced from BS)
BS reported that even as POSCO India is yet to submit a written response on the draft prepared for renewal of MoU with the Orissa government, the company is understood to have raised certain reservations over the omission of the iron ore swapping clause in the revised pact.
While POSCO has verbally agreed not to export iron ore from Orissa, the steel maker has requested the state government to allow it to swap high alumina content iron ore found in Khandadhar mines with high grade ore of any other firm including state owned Orissa Mining Corporation within the state.
A mines department official familiar with the development said that "POSCO India is yet to submit its written reply to our draft MoU. However, the company, during discussions with the state government officials, has agreed to our other conditions including adhering to the employment clause and promoting ancillary industries around the mother plant.”
The Orissa’s state chief secretary Mr BK Patnaik maintained that POSCO India is yet to submit any written response in connection with the renewal of the MoU that lapsed on June 21 last year.
Despite commitments from top officials of the state government, the renewal of MoU with POSCO India had suffered an inordinate delay. The state government had jumped three of its stipulated deadlines in the road to renewal of the pact.
(Sourced from BS)
Saturday, July 30, 2011
Indian iron ore mining mess - Belekeri port was anchor point for irregularities
Saturday, 30 Jul 2011 |By DHNS
Justice Santosh Hegde in chapter 2 titled ‘Export of illicit iron ore from Belekeri port’ on illegal mining said that large scale irregularities were found in the small port at Belekeri, south of Karwar in Uttara Kannada district of Karnataka.
His team, along with the forest department which had raided and seized ore at the port, had subsequently lost most of it to theft. About 610,000 tonnes of the seized ore was stolen, while only 272,000 tonne remains at the port.
The report states large scale illegal exports of ore was done by private companies Shree Mallikarjun Shipping Pvt Ltd, Adani Enterprises Ltd, Salgaonkar Mining Industries Pvt Ltd and Raj Mahal Silks.
Officials of the ports department, customs, police, KSPCB, CRZ, mines department and local politicians received bribes from Adani Enterprises for undue favors for illegal exports.
It was found that 44 companies were supplying ore exclusively to Adani, 30 companies to SMSPL and eight to both companies.
The companies are GG Mines of Gogga Gurushantaiah and brothers, Continent Impex Pvt Ltd, Nagappa mines of Shantalakshmi Jairam, SB Minerals, Junjubail of Dream Logistics, SVK Jaisingpura of SB Minerals, SVK Danapur of S B Minerals, VS Lad, Nadeem Minerals, Sunrise of SB Minerals, ILC of SB Minerals, ILC Bevanahalli, Trident Minerals, Lakshmi Venkateshwara Minerals, Arshad Export of SB Minerals, Alpine International of Vesco, Bharat Mines and Minerals, Taurine Iron and Steel Co Pvt Ltd and Satya Granites.
The report said that the ore illegally extracted and transported came from Hospet, Sandur, Bellary and Koppal.
The total ore exported from Belekeri port from 2006 to 2011 was 2.03 crore metric tonnes; permits were issued to transport ore from various places to Belekeri port worth 1.26 crore metric tonnes; illegal ore exported was 7.73 million metric tonnes; illegal ore export was highest in 2009-10 at 3.65 million metric tonnes; illegal export in two months in 2010-11 was a record breaking 1.15 million metric tones.
Justice Santosh Hegde in chapter 2 titled ‘Export of illicit iron ore from Belekeri port’ on illegal mining said that large scale irregularities were found in the small port at Belekeri, south of Karwar in Uttara Kannada district of Karnataka.
His team, along with the forest department which had raided and seized ore at the port, had subsequently lost most of it to theft. About 610,000 tonnes of the seized ore was stolen, while only 272,000 tonne remains at the port.
The report states large scale illegal exports of ore was done by private companies Shree Mallikarjun Shipping Pvt Ltd, Adani Enterprises Ltd, Salgaonkar Mining Industries Pvt Ltd and Raj Mahal Silks.
Officials of the ports department, customs, police, KSPCB, CRZ, mines department and local politicians received bribes from Adani Enterprises for undue favors for illegal exports.
It was found that 44 companies were supplying ore exclusively to Adani, 30 companies to SMSPL and eight to both companies.
The companies are GG Mines of Gogga Gurushantaiah and brothers, Continent Impex Pvt Ltd, Nagappa mines of Shantalakshmi Jairam, SB Minerals, Junjubail of Dream Logistics, SVK Jaisingpura of SB Minerals, SVK Danapur of S B Minerals, VS Lad, Nadeem Minerals, Sunrise of SB Minerals, ILC of SB Minerals, ILC Bevanahalli, Trident Minerals, Lakshmi Venkateshwara Minerals, Arshad Export of SB Minerals, Alpine International of Vesco, Bharat Mines and Minerals, Taurine Iron and Steel Co Pvt Ltd and Satya Granites.
The report said that the ore illegally extracted and transported came from Hospet, Sandur, Bellary and Koppal.
The total ore exported from Belekeri port from 2006 to 2011 was 2.03 crore metric tonnes; permits were issued to transport ore from various places to Belekeri port worth 1.26 crore metric tonnes; illegal ore exported was 7.73 million metric tonnes; illegal ore export was highest in 2009-10 at 3.65 million metric tonnes; illegal export in two months in 2010-11 was a record breaking 1.15 million metric tones.
Tuesday, March 1, 2011
Iron Ore-Prices steady as market weighs India tax hike
Tue Mar 1, 2011 8:04am GMT
* Prices could rise $10-$15 near term on India move-trader
* India quadruples export tax on iron ore fines
(Updates Shanghai rebar price, adds China steel output)
By Manolo Serapio Jr
* Prices could rise $10-$15 near term on India move-trader
* India quadruples export tax on iron ore fines
(Updates Shanghai rebar price, adds China steel output)
By Manolo Serapio Jr
SINGAPORE, March 1 (Reuters) - Spot iron ore prices were mostly steady on Tuesday as slow demand from top buyer China tempered the impact of India's move to raise export duties, although traders said they expect prices to edge up later in the week.
India, the world's third-largest iron ore exporter, on Monday said it will quadruple export duties on iron ore fines to 20 percent as it seeks to curb exports, mostly destined for China.
The move which should further tighten global supply of the steelmaking ingredient and is likely to fuel another rally in iron ore prices, which have declined since hitting record highs in mid-February.
Indian ore with 63.5 percent iron content was quoted at around $188 a tonne, including freight, in China on Tuesday, said Chinese consultancy Mysteel.
"I think the increase in iron ore tax would have an impact on prices but it will take at least a couple of days for that to sink in," said a Shanghai-based iron ore trader who sells Indian cargoes to China.
"People would prefer to wait and watch. Prices had been coming down before the tax was announced, so they would stabilise first then there might be a slight increase," he said, adding he expects the Indian 63.5 percent grade to hit $190 within the week.
China's appetite for iron ore thinned last week as steel prices retreated after hitting a series of record highs last month, reflecting worries that Chinese steel demand might not pick up strongly because of the government's campaign to tighten monetary policy.
China's crude steel output rose 6 percent in the first 20 days of February from January, but stockpiles of steel products at major enterprises rose to 9.46 million tonnes from 7.57 million tonnes at the end of January, data from the China Iron and Steel Association showed.
STALEMATE
"I think there is a stalemate between the buyers and sellers right now and for us buyers we totally depend on the steel price in China," said a trader in China's eastern Shandong province.
"If the steel price would increase then we could accept any offers but I'm not sure the market is ready to accept ore at $200 because the end-user cannot accept the higher cost."
The most active steel rebar contract for October delivery on the Shanghai Futures Exchange fell to a two-month low of 4,816 yuan a tonne on Tuesday. It closed at 4,837 yuan, down 1.3 percent.
Huge stockpiles of imported ore at Chinese ports, which exceeded 80 million tonnes last week, are also deterring Chinese steel mills and traders from snapping up Indian material in the spot market.
"As long as you have a lot of stock available at ports which is typically cheaper than new imports, people would prefer to consume that first," said the Shanghai trader.
Still, Indian spot prices could rise by $10 to $15 a tonne in the near term because of the duty hike, said the Shandong-based trader.
Forward swaps rose on Monday as investors looked to more price rises. The Singapore Exchange-cleared March contract gained 0.7 percent to $176.67 a tonne, April rose nearly 2 percent to $167.17 and May jumped 2.3 percent to $163.92.
All three key iron ore indexes, which global miners use in determining quarterly contract prices, fell.
Platts iron ore benchmark IODBZ00-PLT slipped 50 cents to $183 a tonne, its weakest since Jan. 17 and marking its eighth consecutive session of losses.
Metal Bulletin's 62 percent index .IO62-CNO=MB dropped $1.36 to $180.5 a tonne, and The Steel Index's 62 percent gauge .IO62-CNI=SI slid $1.30 to 182.8, their lowest since mid-January.
Global miners like Vale and Rio Tinto are likely to raise second-quarter iron ore contract prices by 20 percent to an all-time high after spot prices hit a record peak this month, Reuters calculations showed on Monday.(Editing by David Fogarty,sourced Thomson Reuters)
Tags :Tags :raw material, Indian fine iron ore prices,CISA,iron ore traders, Platts, Metal Bulletin
India, the world's third-largest iron ore exporter, on Monday said it will quadruple export duties on iron ore fines to 20 percent as it seeks to curb exports, mostly destined for China.
The move which should further tighten global supply of the steelmaking ingredient and is likely to fuel another rally in iron ore prices, which have declined since hitting record highs in mid-February.
Indian ore with 63.5 percent iron content was quoted at around $188 a tonne, including freight, in China on Tuesday, said Chinese consultancy Mysteel.
"I think the increase in iron ore tax would have an impact on prices but it will take at least a couple of days for that to sink in," said a Shanghai-based iron ore trader who sells Indian cargoes to China.
"People would prefer to wait and watch. Prices had been coming down before the tax was announced, so they would stabilise first then there might be a slight increase," he said, adding he expects the Indian 63.5 percent grade to hit $190 within the week.
China's appetite for iron ore thinned last week as steel prices retreated after hitting a series of record highs last month, reflecting worries that Chinese steel demand might not pick up strongly because of the government's campaign to tighten monetary policy.
China's crude steel output rose 6 percent in the first 20 days of February from January, but stockpiles of steel products at major enterprises rose to 9.46 million tonnes from 7.57 million tonnes at the end of January, data from the China Iron and Steel Association showed.
STALEMATE
"I think there is a stalemate between the buyers and sellers right now and for us buyers we totally depend on the steel price in China," said a trader in China's eastern Shandong province.
"If the steel price would increase then we could accept any offers but I'm not sure the market is ready to accept ore at $200 because the end-user cannot accept the higher cost."
The most active steel rebar contract for October delivery on the Shanghai Futures Exchange fell to a two-month low of 4,816 yuan a tonne on Tuesday. It closed at 4,837 yuan, down 1.3 percent.
Huge stockpiles of imported ore at Chinese ports, which exceeded 80 million tonnes last week, are also deterring Chinese steel mills and traders from snapping up Indian material in the spot market.
"As long as you have a lot of stock available at ports which is typically cheaper than new imports, people would prefer to consume that first," said the Shanghai trader.
Still, Indian spot prices could rise by $10 to $15 a tonne in the near term because of the duty hike, said the Shandong-based trader.
Forward swaps rose on Monday as investors looked to more price rises. The Singapore Exchange-cleared March contract gained 0.7 percent to $176.67 a tonne, April rose nearly 2 percent to $167.17 and May jumped 2.3 percent to $163.92.
All three key iron ore indexes, which global miners use in determining quarterly contract prices, fell.
Platts iron ore benchmark IODBZ00-PLT slipped 50 cents to $183 a tonne, its weakest since Jan. 17 and marking its eighth consecutive session of losses.
Metal Bulletin's 62 percent index .IO62-CNO=MB dropped $1.36 to $180.5 a tonne, and The Steel Index's 62 percent gauge .IO62-CNI=SI slid $1.30 to 182.8, their lowest since mid-January.
Global miners like Vale and Rio Tinto are likely to raise second-quarter iron ore contract prices by 20 percent to an all-time high after spot prices hit a record peak this month, Reuters calculations showed on Monday.(Editing by David Fogarty,sourced Thomson Reuters)
Tags :Tags :raw material, Indian fine iron ore prices,CISA,iron ore traders, Platts, Metal Bulletin
Monday, February 28, 2011
India hikes iron ore export duty to 20 pct
Mon Feb 28, 2011 8:47am GMT By Thomson Reuters
* Industry body says exports will be uncompetitive
* Shares in producer Sesa Goa slide
MUMBAI Feb 28 (Reuters) - India hiked export duty on iron ore to 20 percent from 5 percent for fines and from 15 percent for lumps in its budget on Monday in a move to curb exports and likely to push red-hot global prices higher.
India, the world's third-biggest iron ore exporter, wants to conserve the natural resource for domestic consumption.
"This will make the exports of (Indian) iron ore uncompetitive in the global market," said R.K. Sharma, secretary general of the Federation of Indian Mineral Industries (FIMI).
Steel Minister Beni Prasad Verma called for curbs on exports of iron ore on Friday and Karnataka, the country's second-biggest producing state, has a ban on shipments which is currently being contested by exporters in the Supreme Court.
India's iron ore exports have already slumped on the ban by Karnataka, with sales down 24.8 percent in December to 9.7 million tonnes from a year ago.
Exports during the April-December period fell 17.02 percent from a year earlier to 64.4 million tonnes. The country usually exports around 100 million tonnes per year.
Two other states, leading producer Orissa and Chhattisgarh, which accounts for 5 percent of India's annual shipments, have asked the federal government to allow them to ban exports.
The hike in export duty in the budget for the year to March 31, 2012 was widely expected as the country tries to underpin its rapidly-growing economy with investment in infrastructure.
The government would prefer states to focus on better regulation of the sector and incentives for increased domestic use of the resource -- moves which target better illegal production instead of export bans which hurt all producers.
FIMI's Sharma said the export duty would deter buyers.
"This measure could be counter-productive, and would make overseas importers shy away from buying from here," he said.
Shares in iron ore miner Sesa Goa extended losses on the duty imposition to hit a 52-week low.
India hiked freight rates for iron ore exports by 50 percent to 1,500 rupees per tonne on Jan. 27 but kept it unchanged in Friday's Railway Budget.
Spot iron ore prices extended losses on Monday after slumping 5 percent from mid-February last week, with Chinese steelmakers expecting prices to fall further on demand uncertainties.
(Reporting by Siddesh Mayenkar; Editing by Jo Winterbottom)
Subscribe to:
Posts (Atom)
Posts
