MANILA (Commodity Online) : The Philippines is considering a five year moratorium on exports of iron ore till the completion of its two integrated steel processing plants.

According to country's Department of Environment and Natural Resources (DENR), the proposed ban comes from the need to conserve the resource for the possible establishment of iron or steel plants as well as the rights of the companies producing iron.

The Philippines shipped 76,500 gross tons of iron ores and concentrates including roasted iron pyrites amounting to P84.4 million last year.The shipments were for China, Taiwan, Hong Kong and Japan.

With iron ore prices rising fast in the world market, the Department of Environment and Natural Resources is also mulling on an ambitious plan to build two integrated steel processing plants at a combined cost of $3.2 billion in capital expenditure.

If we have our own processing facility we can now dictate terms, same thing as what VALE of Brazil, BHP and Rio Tinto of Australia are doing to the market, said DENR.

The price of iron ore shot up to $120 to $130 per metric ton (MT) in the last two weeks, from $70 per MT in 2009, helped by rising demand of car manufacturers and makers of heavy machineries. The commodity was trading at $140-$145 per MT on Wednesday.

The plant would have a rated capacity of 2.4 million MT a year, using iron ore deposits called magnetite which is being mined in small quantities in various parts of the country.