India's Department of Industrial Policy and Promotion (DIPP) has recommended that the country's largest iron ore miner, state-owned National Mineral Development Corporation (NMDC), either renegotiate or stop exports of iron ore to Japan and South Korea under long-term agreements (LTA), a senior government official told SteelOrbis on Tuesday, January 13.
The government's apex industrial advisory body, DIPP, has said that, given the sharp fall in international iron ore prices, NMDC should not continue to get low export realizations from overseas shipments and, if the long-term agreements cannot be renegotiated, exports should be stopped and domestic supplies increased in view of the raw material shortage faced by local steel mills, the official said.
The DIPP recommendations come in the wake of several petitions from the domestic steel industry and other industry organizations like Associated Chambers of Commerce (Assocham) seeking a halt to iron ore exports by NMDC considering that several domestic mines are yet to resume production across several provinces following shutdowns ordered by India's Supreme Court. NMDC, with annual production of about 30 million mt, exports an average of 2.5 million mt per year to Japan and South Korea under negotiated LTAs.
However, according to the official, a final decision on renegotiating the LTAs depends on the Ministry of Steel, the administrative government controlling authority of NMDC and MMTC, the government trading house that acts as the export arm of the mining company.
Source: Steel Orbis
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