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MMTC plans trading company in South Africa

Apart from huge reserves of coal and diamond, the African continent is home to more than 90% of the world's cobalt, chromium and platinum

BS Reporter  |  Bhubaneswar 

MMTC Ltd, the country’s biggest exporter of minerals, is contemplating to set up a full-fledged trading company in South Africa to tap the African region's enormous mining assets.

With iron ore exports from the country taking a severe hit due to prevailing restrictions and slump in output, MMTC is strategically looking to exploit mineral trade potential offered by Africa.

“We see a huge opportunity for mineral trading in Africa. MMTC has opened an office in Johannesburg and now we have plans to set up a full-fledged trading company,” said MMTC’s chairman cum managing director Ved Prakash.

Apart from huge reserves of coal and diamond, the African continent is home to more than 90 per cent of the world's cobalt, chromium and platinum, 50 per cent of gold deposits, 64 per cent manganese and a third of the world’s uranium reserves.

“Due to some restrictions, iron ore exports from the country are not happening. We used to export 15-16 million tonne iron ore every year. More than MMTC, is a loss to the nation. But we hope that with the resumption of mines, exports will pick up again,” he said.

Prakash said, the loss due to thaw in iron ore exports has been compensated by trading in other commodities, particularly coal and wheat. He expected export turnover by the close of this fiscal to be a tad higher than 2014-15. One of the leading foreign exchange earners, MMTC has a total turnover of around $10 billion.

He said, coal imports by India would continue to remain robust for at least three years since the companies would take time to start mining after awarding of blocks through the auction route. From 60-70 million tonne of coal imports 2-3 years back, imports of the dry fuel have now surged to the level of over 150 million tonne a year. With production by Coal India at static levels and thermal power generation on the rise, the uptrend in coal imports will continue, he said.

The MMTC CMD is also bullish on imports of gold and silver fuelled by growing domestic demand. “This fiscal, we have made better margins in bullion imports despite uncertain policies and imposition of duties and restrictions by the Government of India. In next fiscal too, MMTC hopes to do well in imports of gold and silver.”

First Published: Tue, March 24 2015. 20:17 IST
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