The country’s miners' body has written to the commerce and industry ministry, requesting it to not impose export duty on low-grade iron ore to prevent its stockpiling and wastage.
In a recent letter to Piyush Goyal, Minister of Commerce and Industry, the Federation of Indian Mineral Industries (FIMI) highlighted the fact that there is virtually no demand domestically for low-grade iron ore since the Indian steel industry currently consumes only high-grade iron ore (with Fe of 62 per cent or more).
"To have effective utilisation and monetisation of low-grade iron ore and enhanced availability of iron ore for the domestic steel industry, we humbly submit that no export duty be imposed on exports of low-grade iron ore,” the body wrote in its letter.
Almost 70-75 per cent accumulated low-grade iron ore material or fines are generated during mining and remain stranded at mind heads or old dumps, leading to environmental problems and resource wastage, which severely impacts mining operations and reduces employment.
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Limited quantities of low-grade iron ore are used for pellet manufacturing, but the majority remains unutilised, posing environmental challenges and restricting scientific and sustainable mining since fines cannot be removed from mining lease areas unless exported.
Moreover, the inability to evacuate low-grade fines leads to reduced production of higher-grade ore, affecting overall industry output and downstream operations.
FIMI pointed out that India is endowed with huge iron ore resources, therefore the iron ore production has been increasing year-on-year. With the recent transformational MMDR Amendment Act, 2025, new mineral blocks are also expected to become operational shortly, further enhancing supply.
Since there is ample to meet domestic demand for steelmaking and by MSMEs (mainly +60 per cent Fe ore), exporting the surplus ore, for which there is barely much demand, is ideal. Not only will its export avoid mine closures and preserve employment, but also bring in foreign exchange, the body added.
Citing data showing India's crude steel production, which has grown from 103.54 million tonnes in 2020-21 to 152.18 million tonnes in 2024-25, FIMI said the projected surplus according to its estimates for 2025-26 is 35 million tonnes.
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