Friday, April 08,
Indian high court announced April 5 to lift the Karnataka’s export ban, beginning from April 20..*
Indian Karnataka State issued a ban on iron ore export in July 2010 in an effort to tackle illegal mining and to preserve resources for domestic consumption. Apart from this, the government had decided to hike the export duty of iron ore fines and lump ore to 20% this year.
According to market reports, spot iron prices in China likely to stay firm despite lifting of ban on exports from Karnataka. It will certainly add up the supply to the market but Goa ports will remain close for monsoon season said an exporter based in Bangalore.
Goa is the largest exporter of Iron ore fines in India and hence it will create a short supply in the market which is likley to be fulfilled by Karnataka.
The lifting of Karnataka export ban is positive for Sesa Goa. The company has 6 million MT capacity in Karnataka i.e. (27% of total mining capacity) which remained unutilized due to the ban.
So, now as Karnataka Government has allowed the resumption of iron ore exports from the state, most of the regulatory risks associated with Sesa Goa have played themselves out.
Leave a Reply