Iron ore exports to be 40 mt and output to reach 200 mt: Traders
India's iron ore export is expected to reach 40 million tonnes this year while mine production is set to touch 200 million tonnes, according to traders at an industry forum here.
Last year's iron ore exports were estimated between 25-30 million tonnes of mostly lower grade, between 52 per cent and 58 per cent FE (iron) content. Production in 2016 was at 185 million tonnes.
"We are seeing a significant increase in iron ore exports, going beyond 40 million tonnes this year as mines increase output. The production is expected to go above 200 million tonnes," said a regional trader who would not want to be quoted.
Traders said iron ore prices were low in India, about $20 per tonne at pit head and $40 per tonne at ports, making it viable to export the mineral to major mills in China where current prices are around $67 per tonne. High prices, having peaked at $95.00 recently, makes it viable for India to export the ore, especially the higher grade with above 58 per cent FE content, which is levied 30 per cent export tax, said the traders at the Singapore Iron Ore Forum held on Thursday.
India has imposed 30 per cent export tax on iron ore with 58 per cent and above FE content.
"We see West Coast export at $60 per tonne and East Coast at $70," said an Asian trader dealing in China-India ore trade. The difference is due to inland transportation costs between mines and the ports.
The traders said Chinese mills would want to increase higher grade Indian ore imports, especially that with more than 58 per cent FE content.
Most of Indian export to China is of 52 per cent to 58 per cent FE content ore which is blended and processed into steel. The forum on Thursday was attended by 1,000 delegates and traders from the global iron ore sectors.