Author: Paul Ploumis
09 Oct 2014 Last updated at 05:30:58 GMT
NEW DELHI (Scrap Monster): The condition of Indian shipment of iron ore was already in the gutters due to the ban on production in the main iron ore producing states of India, on top of that the government is imposing 30 percent tax on the exported iron ore, which makes it difficult for the producers to sell it in the global market, where the price of the commodity has sunken 40 percent.
The Chief Excecutive of Vedanta Resources, Tom Albanese, stated that, there is an urgency in the need of dismissing the export tax, as this would only boost the economic barrier being created due to the decline in the price of the low grade iron ores. Vedanta Resources control the Sesa Sterlite located in Goa.
The company hopes to restart the production at their iron ore mine located in Goa, from the beginning of next year, as the Supreme court is planning to lift the 19 month old ban off from the mines in the process uprooting growing number of illegal miners.
As the global price of iron ore keeps on decreasing it is safe for the iron ore producers to sell their output to the local market, rather than to export it. The deficiency in the availability of iron ore pushes the market to import more iron ore.
Even though the ban on Goa based iron ore mine is lifted, it is of little use for the Indian steel makers as they do not possess sophisticated technology to process low grade iron ore.