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Paradip Port Trust (PPT) targets to export 5.5 million tonne iron ore, including about 1.5 million tonne iron pellets, in the current financial year.
This is 300 percent more than the 1.8 million tonne iron ore exports recorded by the port last year. The higher target is based on improved global demand for this steel making raw material.
“For 2013-14, we have set a target of 4 million tonne iron ore exports along with 1.5 million tonne iron ore pellet as market condition is good for the commodity. Pellet exports are just emerging and will continue to grow in coming years”, said Sudhansu Sekhar Mishra, chairman, PPT.
By the end of October, total iron ore shipment from the port was about 2.8 million tonne, data from Indian Port Association said.
In 2012-13, poor Chinese demand coupled with problems in availability of iron ore within the state due to restrictions imposed by the government, had pegged back the exports to historical low of just 1.83 million tonne, against 12-13 million tonne reported annually in 2008-09 and 2009-10.
The unavailability of iron ore was so acute last year that local steelmakers, such as Bhushan Steel and Power Limited had to import iron pellets from Brazil to run its mill in Sambalpur district. Though Odisha produced 62 million tonne iron ore in the last fiscal, it was not easily available to steel mills, as the state government had imposed restrictions on road transportation of minerals. However, major miners attributed the lull in exports in 2012-13 to higher pricing and stiff export duty slapped by the Union government. In February 2013, the rates rose to $158 a tonne for 62 grade ore in global markets, forcing Chinese buyers to scale down imports from India amid a rise in export duty from 20 per cent to 30 per cent.
“In 2012-13, India’s contribution to Chinese iron ore supply dropped from 6 per cent to below 2 per cent due to higher prices. Things have improved since then,” said a local miner, who regularly supplies large orders to China.
The rates are currently hovering around $120-122 per tonne at Indian ports.
Besides iron ore fines, pellet exports are picking up from Odisha, which has large capacities of pellet production.
Though the amount of conversion of fines into pellet is lower in Odisha in comparison with generation of fines, recently it has gone up as some firms have shown interest to produce pellet. At present, Jindal Steel and Power Ltd, Brahmani River and Pellet Ltd, Essar Steel, Bhushan Steel and Power Ltd and Adhunik Metaliks are engaged in production of pellets with a combined annual production capacity of 20 million tonne.
Pellets are produced from dusty iron ore fines and are used as raw material for steel production. They can be used in place of sized iron ore in blast furnaces and are priced higher than fines.
