Though central government recently reduced the distance based charges (DBC) for iron ore exports w.e.f. 08 Sept’15, export from India still does not appear viable.
The reduction in DBC comes as govt. measure to boost exports over increasing iron ore production in India. However, exports from India are still unviable due to week global iron ore market. Also, another reason could be expensive plots of miners at Paradip Port.
It seems, the government took the decision to reduce DBC considering NMDC’s new export long term agreement with Japan and South Korea.
In June’15, the government renewed long term trade agreement with Japan and South Korea to export NMDC’s iron ore for a period of 3 years. Under this, about 3.8 to 5.5 MnT of NMDC’s high grade iron ore will be shipped to these countries by MMTC.
Following are the current estimated freight charges applicable from different railway sidings to different ports across India:-
| State | Railway Siding | Distance (kms) |
Base Freight | Previous Freight for Exports | Current Freight for Exports | Freight Change |
| Odisha | Jaroli to Paradip | 361 | 613 | 2,400 | 1,100 | -1,300 |
| Jaroli to Vizag | 772 | 1,244 | 2,600 | 1,720 | -880 | |
| Barbil to Haldia | 400 | 650 | 2,470 | 1,100 | -1,370 | |
| Jaroli to Dharma | 332 | 580 | 2,340 | 1,025 | -1,315 | |
| Jaroli to Krishnapatnam | 1420 | 2,266 | 3,640 | 2,800 | -840 | |
| Jaroli to Kakinada | 930 | 1,463 | 2,800 | 1,950 | -850 | |
| MP/C.G. | Gosalpur to Vizag | 1,015 | 1,682 | 3,030 | 2,170 | -860 |
| Siliari to Vizag | 548 | 875 | 2,420 | 1,330 | 1,090 | |
| Kotarlia to Vizag | 615 | 1,023 | 2,450 | 1,490 | -960 |
Freight in INR/MT, including 4.2% service tax
Source: Indian Railways,SteelMint
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