MUMBAI (Commodity Online): India's recent decision to raise the duty on iron ore lumps will rein in export of the commodity further.
The government last week increased the export duty on iron ore lumps to 15% from 10% to discourage exports and improve raw material availability for local steel mills.
India's iron ore lump exports was around 11 million tonnes in 2009-10 and declined by 28% in the past four years from a peak of 15.3 million tonnes in 2006-07.
Iron ore exports will decline by around 5% in the current financial year due to the duty hike. Indian iron ore exports peaked at 106 million tonnes in 2009-10 from 78.14 million tonnes in 2004-05.
China's new regulations on housing will also impact the export of India as the Chinese realty sector is in a crisis now.
The iron ore lumps are largely consumed by the Indian steel units, mainly the sponge iron manufacturers. The lumps are not in demand worldwide and accounted for about a tenth of total Indian exports.
Indian lumps are mainly imported by China, Japan and South Korea.