India raises export duty on iron ore and iron and steel products
According to a notice published by the country's Ministry of Finance dated May 21, the Indian authorities also introduced a 50% export duty on all types of iron ore and 45% on iron ore pellets (pellets). In addition, export duties were introduced on 11 types of ferrous metallurgy products, including 15% on the export of cast iron, long products, as well as a number of hot and cold rolled flat products.
Additionally, India has zeroed import duties for a number of steelmaking ingredients: coking coal, anthracite and ferronickel.
Participants in the Indian steel market are pessimistic about Indian exports and that the market is currently unable to withstand the additional financial impact of duties.
Pellet prices in India are expected to fall by at least 30%.
Chinese steel mills are largely dependent on domestic pellet supplies, and imported material from various sources is used to make up any shortfall. However, low steel production margins are discouraging many end users from using higher quality iron ore such as pellets, keeping demand low.
Demand for pellets in China could change dramatically as margin increases, and higher export duties will affect the market for at least six months or more. Indian pellet supply has already risen by around 50-80 yuan from the previous week as sellers expect Indian iron ore to rise in price.