Iron ore surplus rises sharply in Karnataka on falling demand, export ban

Supply in the state is higher compared to demand amidst production restrictions and the ban on exporting ore out of the state imposed by the Supreme Court

Supply of iron ore has surged to excessive levels in Karnataka, which has been under severe restrictions since eight years. Exports, even to other states, are still prohibited, thereby leaving miners dependent on steel firms within the state.

Surplus availability currently stands at 5.19 million tonnes (mt). The higher supply vis-à-vis demand is on account of the production cap and ban on exports. In 2019, total exports from other states stood at 10.34 mmt of fines, and 1.116 mmt of lumps. This reflects the export potential for Karnataka.

In 2012, the Supreme Court —hearing a case of illegal mining and export from