Iron ore

Shipments of raw materials fall for the third month in a row, mainly due to lower demand from China

Mining companies in India reduced iron ore exports by 53% in March 2024 compared to the previous month – to 3.28 million tons. This is evidenced by CYBEX data, Kallanish reports.

Shipments of raw materials have been falling for the third month in a row, mainly due to lower demand from China, which is the main consumer of Indian iron ore (85-90% of total exports). Over the past two months, China has been facing a decline in domestic demand for steel, which has led to a reduction in the demand for raw materials by steelmakers.

India mainly exports low-grade fines, with pellets accounting for about 12-15% of total shipments. In March 2024, India’s pellet exports amounted to 0.48 million tons, down 13% compared to February.

Chinese steelmakers booked significant volumes of iron ore and pellets during the fourth quarter of 2023. As a result, Indian exports were quite high until January 2024. However, in February-March 2024, demand slowed due to sufficient stocks and holiday periods.

In January-March 2024, India exported 18.5 million tons of iron ore and pellets.

Although India has one of the largest iron ore reserves, the country usually exports surplus low-grade ore, using high-quality raw materials for domestic crude steel production.

As GMK Center reported earlier, India is considering the creation of the country’s first iron ore exchange to determine the domestic selling price of raw materials. The proposal was submitted by a group of experts appointed by the government. The proposed exchange will record real-time transactions and physical deliveries of iron ore.

India increased iron ore production to a historic high of 282 million tons in 2023, up almost 14% year-on-year. In particular, miners increased volumes due to stimulated demand due to the growth of steel production in the country, and export demand also increased.