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India's Iron Ore Exports Plummet
File Date 2011.12.22 Hit 2647
INDIA'S iron ore exports plunged in the first 11 months this year as Delhi increased curbs on export cargoes.

From January to November, export volumes fell 21.6% year on year to 80M tonnes. Shipments in November alone fell more than 30% y/y to 5.1M tonnes, after exports from Orissa were barred. As its steel industry grows, Delhi has acted to reserve more of India's ore for domestic use.

Last year, exports from Karnataka were barred after allegations of illegal mining. The ban was partly lifted in the middle of this year, but exports from Orissa and Goa were restricted this year. Authorities have stopped granting export permits for cargoes shipped via the Andhra Pradesh ports Gangavaram and Kakinada, which Delhi said had failed to submit required data.

Drybulk consultancy Commodore Research said roughly 25 mines in Orissa are affected and noted that India has continued to intensify curbs on iron ore production and exports.

In Goa, 59 iron ore mines in Goa have been forced to halt operations, reportedly for lacking proper environmental permits. Initially, 14 mines were forced to suspend operations in August; the other 45 mines were handed suspension notices in November. The original 14 mines can produce about 7M tonnes of iron ore per year, but it is unknown how much ore the newly shutdown mines can produce.

Given that Goa usually produces up to 50M tonnes per year, a conservative estimate of Goa's lost output could be 15-30M tonnes, Commodore reckoned. It told Fairplay: "Mines capable of producing 28M tonnes of iron ore each year also remain shut down in Karnataka. We have revised our ‘worst-case scenario’ to reflect the change in Goa. “In total, as much as 58M tonnes of annual iron ore production is now at risk of being lost in India,” Commodore concluded.