Economy

Iron ore mine owners, govt at loggerheads over exports

Suresh P Iyengar Mumbai | Updated on October 15, 2020 Published on October 15, 2020

The steel and sponge iron industry require 165 mt of iron ore   -  THE HINDU

No need to conserve iron ore in future as steel producers rely more on recycling, says FIMI

The Federation of Indian Mineral Industries (FIMI) has retorted to the steel producers and Piyush Goyal, Minister of Railways, Commerce and Industry, claim that the mining industry is exporting scarce iron ore resource to competing countries which are dumping finished steel products in India.

Refuting the blame, FIMI said there is no need to conserve iron ore as steel in future will be produced by recycling with the production increasing progressively generating enough scrap for reuse.

Last year, India recycled 25 million tonnes of steel which accounted for 28 per cent of 90 mt of crude steel produced last year. China consumes 216 mt of scrap accounting 22 per cent of steel produced while in EU and the US recycled steel adds up to 55 per cent and 69 per cent of steel production.

Goyal in a recent video posted on his Twitter handle said that India, the world’s second largest steel producer, has capacity of 100 mt, while it is 800 mt in China. Look at the gap and India is exporting iron ore to China.

“I am told China has iron ore but they are conserving it. Can we think of some smart options?” he questioned.

India needs to move beyond exporting raw materials and improve its manufacturing capabilities to supply high-quality products to the world, he added.

RK Sharma, Secretary General of FIMI, in a letter to Goyal said nobody needs to conserve iron ore as it may not be required for the future generation.

Global steel scrap availability is expected to touch one billion tonnes in next 10 years and further to 1.30 billion tonnes equivalent to 1.82 billion tonnes of iron ore by 2050, he added.

“The efficient use of scrap for steel production is crucial for India. The Ministry of Steel envisages that use of scrap in steel production to increase by 35-40 per cent to produce 300 mt of steel in 2030,” said Sharma.

Iron ore exports last month had increased over three times last month to 4 mt against 1.14 mt exports logged last September. In August, exports had hit 3.90 mt.

Miners are exporting iron ore legally to the only buyer in the world that is China and contributing to India’s GDP. There is an export duty of 30 per cent on iron ore with over 58 per cent iron content.

The steel and sponge iron industry require 165 mt of iron ore while the production stands at 206 mt. Since the production is in surplus, the user industry is very selective and wants to buy only iron ore with over 62 per cent iron content, said Sharma.

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

Published on October 15, 2020
  1. Comments will be moderated by The Hindu Business Line editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.