India hikes in iron ore imports

Author: Paul Ploumis

 

08 Jan 2015 Last updated at 06:57:33 GMT

 

NEW DELHI (Scrap Monster): The price of steel making raw material has been down at the a five year lowest point of 65 dollars per tonne by the month December 2013. The main reason for the decline in the price of iron ore had been the increase in the supply of the commodity, accelerated by the iron ore producers in Australia and Brazil, and also the declining demand for the commodity in China, the top consumer of iron ore.

 

It is a relief that, one of the sources of iron ore supply is vanishing, and might in the future give the iron ore miners a boost for moving into new markets. The head of research and business development at the Ore Teamstated that, the iron ore imports in India had hit the highest record in the previous year.

 

The steel producers in India, imported iron ore weighs more than8 million tonnes in the year 2014, which turned the country into a net importer. In the year 2013, the imports of iron ore in the country had been just 1.2 million tonnes, and 3.1 million tonnes in 2012.

 

All these numbers are negligible when compared to the Chinese imports which also increased to a record of 900 million tonnes of iron ore in the year 2014. Before five years, India was importing about 120 million tonnes of iron ore mostly to China, the largest consumer of the commodity.

 

The main reason for the shatter of the iron ore market is a government crackdown in the country which took place in the year 2010, which focused on removing corruption, environmental degradation and also to transform an industry, which was very much in the requirement of modernization. The mines in Goa and Karnataka, which were closed as a result is now slowly restarting their once stopped production.

 

The steel ministry of India, had announced in the month of December 2014, that, the state owned iron ore mining company NMDC, will increase its production of iron ore to 75 million tonnes per year, by the financial year 2018-2019. The ministry had also declared that the company would increase its production to 100 million tonnes by the financial year 2020-2021.