China Looks for Alternatives as India Iron Exports Fall.

A decline in iron ore exports from, India following a crackdown by the government to check illegal mining has prompted China to begin exploring alternate markets to source its requirement of the mineral, a senior official of China Minmetals Corporation said today.

"India's iron ore supply is not very stable. Who can tell what the policy about the iron ore is? Chinese companies are looking for alternatives," Shi Ming Li, the Assistant Chief Representative of China Minmetals Corporation, told PTI today.

Last fiscal, China imported 15 per cent of its iron ore requirement from India, especially Goa, as the produce is priced less compared to imports from other countries.

"India should have a stable and transparent mining policy, which is important for miners," the representative of the state-controlled corporation said.

He was in Goa to participate in an International Iron Ore and Steel-Making Raw Materials Conference. He said China already has alternatives that can be explored to face the deficit.

"It's a turning point for the international iron ore market," Ming Li claimed, adding that Brazil and Australia have a lot of capacities that can be looked up to meet the requirement.

China, which has been sourcing iron ore from Australia, Brazil and South America, besides India, is also looking at countries like South Africa, Iran, Ukraine, Congo, South Africa, Zimbabwe, Indonesia and Venezuela for steady supply of iron ore.

Ming Li said China hopes that exports from India won't be banned. "But it is for the Indian government to decide their own policies," he said.

China does not have long-term agreements for iron ore with India, which usually opts for spot pricing.

Indian traders, too, conceded that the future of Indian iron ore in the Chinese market is uncertain.

"Indian iron ore exports' future is uncertain. We don't know what will happen tomorrow," said Prem Kumar, the spokesperson of Pisces Exim Private Limited, a leading Indian iron ore exporter.

He said India, too, has begun scouting for alternate buyer countries, as it does not want to be entirely dependent on demand from China.

Kumar's company exported three million tonne of iron ore to China last fiscal, which was valued at around $100 million.

"Since we are dealing in the low grade ore, we are also looking at Middle East countries, which require this raw material for the cement industry," Kumar commented.

Pisces Exim began sending shipments to Middle East countries last year.

However, the prevailing uncertainty seems to have forced many traders to put their plans on the back burner.

"We wanted to venture in the trading of iron ore from India to China, but plans are held back because of the existing scenario," said Rahul Mulye, the representative of Coeclerici Asia (Pte) Limited, a Singapore-headquartered trading firm.

At present, Coeclerici Asia (Ptd) Limited is engaged in the export of iron ore from other countries to China.

Source : profit.ndtv.com