India's low-grade iron ore exports rise significantly in FY'21

Iron ore exports from India in the fiscal year 2020-2021 (Apr'20-Mar'21) were recorded at 46.45 million tonnes (mn t), a sharp 86% increase compared to 25.08 mn t in FY'20, according to SteelMint's vessel-line up data. But, low grade iron ore comprised the major share of the exports.

Iron ore exports across various grades saw a significant rise year-on-year (y-o-y) in FY'21.

• Exports of low-grade iron ore with 55% to below 58% Fe content jumped by a sizeable 60% y-o-y mn t to 28.7 mn t and that below 55% Fe surged by 156% y-o-y to 5.6 mn t.
  
  
• The exports of Fe 60% to below 62% grade ore rose sharply by 125% y-o-y to 5.4 mn t.
  
  
• The country exported 2.2 mn t of high grade iron ore (Fe 65% and above), down 9% y-o-y against 2.4 mn t in FY'20.
  
  
• A volume of 1.5 mn t of iron ore (Fe 62% to below 65%) were exported in the last fiscal.
  
  

Increased Chinese demand for low-grade ores

Indian iron ore exports increased following a rise in global iron ore fines (Fe 62%) prices on strong demand from China. The spot prices of iron ore saw an upward trajectory, touching $178/t CFR China levels in Mar'21. Indian iron ore export shipments to China amounted to 43.39 mn t in FY'21, up nearly two-folds against 22.45 mn t in FY'20.

Liquidation of stocks by Odisha miners

India's low-grade iron ore exports from Odisha increased in FY'21 as 19 mining leases which were put up for auction in Mar'20 remained active in liquidating their inventories. It may be recalled that the former lessees of Odisha iron ore mines had been given seven months from 31 Mar'20 i.e. till 31 Oct'20 to liquidate their inventories mined before the end of fiscal 2019-2020.

NMDC accounts for highest share of high-grade ore exports

High grade iron ore exports from India for Fe 60% to below 62% grade recorded a jump of 125% y-o-y to 5.4 mn t and that of Fe 62% to below 65% grade stood at 1.5 mn t in FY'21.

The state-owned miner, NMDC, accounted for the highest share in India's high grade iron ore exports in the last fiscal. The miner exported high grade ores to South Korea and Japan as part of its long term contracts with both the countries.