India’s iron ore exports dropped 13 per cent in April against March at 3.8 million tonnes (mt), primarily on account of slower orders from China and lower steel demand overseas. However, exports were up year-on-year by 25 per cent.
In April, the export of fines and lumps was 3.05 mt and that of pellets and concentrate 0.75 mt. Export of iron ore in April 2022 was 3.05 mt, which included 1.67 mt in fines and lumps and 1.39 mt of pellets and concentrate.
In March 2023, exports were 4.37 mt — the highest over the last 12 months — as per data available from Steelmint.
Also read: At 3.51 million tonnes, NMDC clocks record iron ore output in April
Iron ore exports from the country has been increasing since December as China opened up and India withdrew its export duty Levy. In December, iron ore exports were 2.26 mt; January exports increased 3.42 mt while in February it was 3.8 mt.
China is India’s largest export market for iron ore, a key steel-making raw material.
The China factor
Trade sources tell businessline Exports could come under pressure with China opting for steel production cuts as it plans to bring carbon emissions under control. The buzz is steel production in China could remain at 2022 levels, and this will continue to put pressure on the raw materials.
“On a year-on-year basis, we anticipate iron ore exports to improve over 2022 levels, as the impact of export duty is not there. The port levels stocks in China should come down sometime soon, thus improving demand from India. Also as economic activity picks up, steel demand should improve there,” said an exporter.
Also read: Industry bodies seek Steel Ministry’s intervention on the issue of iron ore shortage
In April, the Chinese steel market saw a sharp drop primarily because of supply-demand imbalance, and there has been no significant improvement this month so far. Since the market there remains weak, raw material price like iron ore saw a fall in early May, as well as drop in coke prices.
The most-traded September iron ore contract on the Dalian Commodity Exchange closed on May 5 at 697.5 yuan ($100.93) a tonne after touching a new five-month low at 675.5 yuan ($97.75) a tonne in the morning.