Wednesday, March 04, 2009
India Iron Ore Exports Slow After Dec, Jan Surge
Wednesday, 04 March 2009
India's iron ore exports slowed again in February after a brief surge in December and January as demand from China waned. The country will likely to export only around 100 million metric tons of iron ore in the fiscal year ending March 31, 2009, Rahul Baldota, president of the Federation of Indian Mineral Industries, said Tuesday. That would be a slight decline from the 104 million tons exported in 2007-08. India is the world's biggest iron ore supplier after Brazil and Australia.
"There was a slackness in demand in February, which is going to spill over to March," Baldota said.
Iron ore exports to China, India's its biggest market, started sliding in May due to large stockpiles there, but had picked up again in December and January, he said.
Demand in China had eased once the construction and infrastructure projects were completed ahead of the Olympics last year. The closure of small steel mills around Beijing to rein in pollution also hit demand for Indian iron ore.
But after the Indian government scrapped export taxes on iron ore in December and Indian Railways started offering discounts for hauling the ore to ports from November, demand had picked up briefly. Exports rose by 38.4% on year in December and 21.5% on year in January.
The recovery coincided with a rise in Chinese steel production during that period. Chinese steel production rose 10% on month in January after rising 7% in December.
But with exports slowing again, Indian iron ore prices, which had started picking up after touching a low of about $50-$52/ton, has dipped by $8-$10/ton across all grades, Baldota said.
Currently, Indian ore is being offered around $65-$66/ton, down more than 50% from a peak of about $145/ton in early 2008.
Source: Dow Jones Newswires
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