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India may boost iron ore exports to China |
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India, the world’s third largest exporter of iron ore, may boost shipments to China in 2012 after the federal government cut freight charges on the commodity to be transported by rail to ports for overseas sales.
Rates were lowered by as much as 30% to INR 1,125 a metric tonne starting March 7th 2012. This is the first reduction in the charges in at least two years.
The cut is bullish for Indian exports and is an indication that the government has started loosening controls on the market, said Thomas Baldwin, an iron-ore, freight and steel trader with Deutsche Bank AG in London. Most of the iron ore from India will find its way to China, he said.
The move will benefit companies including Sesa Goa Ltd. India’s largest iron ore exporter, and state-owned NMDC Ltd the nation’s top producer. Asia’s second-fastest growing major economy increased freight rates and taxes on iron ore over the past two years to curb exports as prices of the steelmaking ingredient surged globally.
Mr RK Sharma secretary general at the Federation of Indian Mineral Industries without giving an estimate of how much shipments can rise said that “The rate cut is welcome, but more needs to be done on the tax front, which is still very high.”
Source : steelguru.com
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