FIMI Urges Govt Not to Impose Export Duty on Low-Grade Iron Ore

Miners' body FIMI has requested the government not to impose any export duty on low-grade iron ore, asserting that any such move would lead to resource wastage, severely impact mining operations, reduce employment, and cause environmental damage due to stockpiling of unusable fines at mine sites.

In a recent letter to Commerce and Industry Minister Piyush Goyal, the Federation of Indian Mineral Industries (FIMI) said, "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.".

FIMI stated that the domestic steel industry currently consumes only high-grade iron ore (+62% Fe), and there is virtually no demand for low-grade fines within India.

The accumulated low-grade material, particularly fines generated during mining, remains stranded at mine heads or in old dumps.

Limited quantities are consumed for pellet manufacturing, but the majority remains unutilised. This situation not only poses environmental challenges but also restricts scientific and sustainable mining, as fines cannot be removed from mining lease areas unless exported.

Exporting these fines is a win-win, as it supports scientific mining, avoids mine closures, preserves employment, and brings in foreign exchange.

Asserting that the country is endowed with huge iron ore resources, FIMI pointed out that there is no shortage of iron ore in the country.

The iron ore production has been increasing year-on-year, both to meet domestic demand for steelmaking (mainly +60%Fe ore) as well as export the surplus ore for which there is barely much demand.

Production has been steadily rising, and with the recent transformational MMDR Amendment Act, 2025, new mineral blocks are expected to become operational shortly, further enhancing supply.

It cited data showing that India's crude steel production has grown from 103.54 million tonnes in 2020-21 to 152.18 million tonnes in 2024-25. The projected surplus according to FIMI estimates for 2025-26 is 35 million tonnes.

A key issue highlighted by FIMI is that in the process of mining, only 25-30% of output is in the form of usable lumps, while the remaining 70-75% comprises fines, many of which fall below the 58% Fe threshold. These fines cannot be used by the MSME or steel sectors in India.

Moreover, the inability to evacuate low-grade fines leads to reduced production of higher-grade ore, affecting overall industry output and downstream operations.