Iron ore traffic at major Indian ports falls in April-July

Major ports in the country witnessed a drastic fall in their iron ore cargo during the first four months of the current financial year. The drop was mainly on account of sluggish demand from China, a major market for Indian iron ore and ongoing investigation into illegal mining and exports in major producing states.

Karnataka, which has been in the eye of the storm over illegal export of iron ore from its ports, banned iron ore exports with effect from July 26. The state has also stopped issuing mineral transport permits for export purposes.

“We have witnessed a drop of 74 per cent in iron ore traffic during April- July owing to ban on iron ore export by the Karnataka government. Much before the ban order came by the end of July, we had seen reduction in iron ore cargo as the state government had started controlling the movement of iron ore to the port,” a senior official at New Mangalore Port Trust (NMPT) said.

During the first four months of this financial year, NMPT handled 800,000 tonnes of iron ore compared to 3.1 million tonnes during the corresponding period of the last financial year. Another main reason for the decline was the intermittent ban on the movement of iron ore by road from the district administrations of Dakshina Kannada, Udupi and Hassan over the last four months, the official said.

During the year 2009-10, NMPT exported 5.2 million tonnes of iron ore fines and pellets, showing a decline of 43.4 per cent over the previous year. The drop was mainly due to global economic slowdown.

The case of eastern ports is no different. Paradip Port Trust, one of the major ports to carry bulk of iron ore saw a significant fall in exports during April-July period. “During April-July, we have handled 3.9 million tonnes of iron ore against 5.1 million tonnes in the corresponding period last year, a drop of 23 per cent year on year,” a top port official said. In July, the port handled 890,000 tonnes of iron ore as against 1.4 million tonnes in the year ago period. He also said that many mines are either inoperative or closed as of now, which has its repercussions on the export performance of the port.

Paradip Port Trust handled iron ore traffic of 16.16 million tonnes in 2009-10 against 14.2 million tonnes in the previous year, a rise of 13 per cent. However, the port is hopeful of sustaining the momentum during the current financial year despite the hiccups, the official said.

Haldia Port had also witnessed around 38 per cent drop in April-July period owing to government control on loading sites along with sluggish demand from China. “Initially, we saw a 40 per cent drop to an average monthly traffic of 650,000 tonnes of iron ore, which dragged down our exports,” a senior port official said.

Haldia Port handled around 7.8 million tonnes of iron ore in 2009-10, a drop of 18 per cent over the previous year.

Source: Business Standard