India’ s government declared that from the early morning of December 25, the export duty on power ore was adjusted from zero to 5% and the lump ore was increased from 5% to 10%. Industry insiders believed that it will stimulate the spot price of Indian ore to China to soar.
Sharma, administrative secretary of the Federation of Indian Mineral Industry revealed that to increase export tariffs on iron ore is a wrong decision made by the government in the time of iron ore presenting rally and steel industry emerging recovery signals, added finance ministry should delay the time to levy export duty on iron ore export and wait the global steel enterprises fully remove the influence of the financial crisis. Indian mining ministry showed the dissatisfaction with the duty increase.
It is learned that as the three mining companies hardly supply ore on the spot market recently, China’ s steel mills turn eyes to India, which made the Indian ore increase fast. The 63.5% Indian ore price (CIF) of U.S.$120 per ton has been apparently higher than the spot price of 62% Australia ore, approaching to the spot offer of 65% Brazilian ore.
Insiders of steel enterprises considered that after Indian lifted export duty, the Indian spot price would be pushed up again, which will be a test for steel mills’ bearing strength, at the same time, iron ore negotiation will be in disadvantage stance. The price difference between Indian spot ore and Australian long-term contract ore to China’s ports has reached U.S.$40.
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