Indian steel mills set a new record by importing an all-time high of over 8 million tonne of key steel-making raw material in the 2014 calendar year.
Lack of stocks in the domestic market and falling prices in the overseas markets encouraged iron ore-starved steel mills to look out for imported material during the year. Major producers like Tata Steel and JSW Steel were the largest importers during the year. JSW Steel had announced its plans to import close to 10 million tonne during 2014-15.
Compared to the previous years, 2014 witnessed heavy imports. In 2013, import of iron ore stood at a mere 1.2 million tonne. CY 2012 had seen previous highest level of imports at 3.1 million tonne. CY 2011 on the other hand had witnessed just about 600,000 tonne, according to data compiled by Delhi-based Ore Team Research.
“Conditions have changed through the years and in the process of correcting the illegalities and regularising the mining industry the judiciary and state governments had to take hard decisions, which led to these circumstances today,” said Prakash Duvvuri, head of research at Ore Team Research.
As a result, India has turned out to be a net importer of iron ore as exports have dipped amidst the shrinking global prices. India exported barely 7.14 million tonne in CY 2014 against 8.12 million tonne of imports, he pointed out.
“We were the third largest exporter a few years ago. This year, India’s exports will come to zero level, unless the government takes some corrective steps and withdraws export duty. The government should at least withdraw duty on Goan ore, which is of low quality and there is no market for it within the country,” Basant Poddar, vice president, Federation of Indian Mineral Industries (FIMI) said.
Looking ahead at 2015, domestic production is likely to improve. Hence, India might see its dependency on imports come down slightly but not sharply.
Since the iron ore production would take time to come back on track and PSU mines would gradually increase their figures, the situation in the domestic market is set to improve in 2015 rather than turning further bullish, Duvvuri added.
However, imports will continue to be higher even in 2015 because the opening up of mines in Goa and Karnataka will take more time. “We can expect some more mines to open this year only by September,” Poddar said.
Source:business-standard.com
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