Iron ore exports through Paradip at all-time low

Iron ore shipment through India's third largest exporting port, Paradip, plunged to all time low in November as the state government restricted intra-state transportation as a measure to discourage exports.

The November shipment of high grade iron ore fines through Paradip stood at just 173,000 tonne against 1.5 million tonne in the same month last year.

The figure is all time low for ore export for any month from Paradip. It was earlier reported by Business Standard that November export through the port could slip to multi-year low to 200,000 tonne.

“I believe the November export data is the all-time low monthly export figure since the start of the Paradip port,” Girish Das, general manager of Orissa Stevedore Ltd (OSL) said.

Till 2010, average monthly iron ore export through Paradip stood at 1.2 million tonne and till October 2011, it averaged at 700,000 per month.

Though the state government has not formally put any ban on export transportation, it did not issue a single transit permit for trucks in November as it wanted to show the Shah Commission, enquiring into illegal mining activities, that it is taking steps to curb such incidents and discourage exports, a move also supported by the commission.

However, there was no restriction on exports through rail network and transportation for domestic consumption. The November exports were mainly done by miners while most traders did not do any business. Besides the restrictions set by the state government, heavy price fluctuation in global iron ore prices due to uncertainty over European economy and slower Chinese demand also dampened exports.

Global iron ore prices in early November slipped to one-year low to $109 per tonne for China delivery, from $170 in early October. Currently, the export rates for high grade iron ore fines are hovering around $125 per tonne. Iron ore exports from all Indian ports also fell to 4.7 million tonne in November, lower than 7.4 million exported in the same period year ago, data available from Indian Ports Association said. M B Shah Commission, meanwhile, in its interim report, has recommended to ban iron ore and manganese export from India saying higher overseas sales led to illegal mining across the country. The Union mines ministry has, however, rejected the recommendation.