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Date: 01/07/2022

Iron ore pellets export seen unviable after 45 pc duty

Export of iron ore pellets has become unviable at current prices after the 45 per cent export duty levied by the government, says Icra. The imposition of this high export tariff has reduced a merchant exporter’s net effective realisation. The steep decline in the effective free-on-board (FoB) price will lead to a supply overhang in the domestic market. This, in turn, would put pressure on domestic prices, which are likely to correct by 30 per cent in the near term. Consequently, the contribution margins of merchant pellet players are expected to decline roughly by Rs 1,000 per mt from pre-duty levels, said Icra, as per a report.

Source: Exim News Service: New Delhi, June 30