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Even as truckers have slashed iron ore transport rates on the backdrop of the falling price of the mineral in the international market, traders said it is not sufficient to push the exports from Odisha, which has suffered severely in past few months, first by local government restrictions and now, due to weak global demand.
 
Truck associations in mineral bearing districts are currently charging Rs 1,900 per tonne to carry iron ore fines to Paradip port, instead of Rs 2,500 per tonne charged two months ago. But still they are hardly getting any order.
 
“The miners are not ready to transport iron ore by trucks citing margin pressure as the prices of the commodity have dropped sharply in last few days. There is not a single transport order since last one month,” said Rabi Das, secretary, Truck Owners’ Association, Joda in Keonjhar district, the largest among mineral bearing areas.
 
Iron ore rates, which ruled at $ 147 in April this year, slipped to a multi-year low of $103 per tonne at Indian ports on Thursday. Exporters said due to 30 per cent export duty and higher procuring cost of about $50 per tonne, they were left with very little margin even at lower transport rates.
 
“Whatever little material is exported, it is being done by the miners only, as this business has become unviable for the traders because of the prevailing bleak scenario,” said Kaushik Mohanty, director, Global Trading Solutions Ltd, adding, the cut in transport charges by the truckers would hardly offset the setback suffered by the traders on account of low international prices and higher procurement cost.
 
However, he pointed out, “The lower transport rates might help the miners who have no procuring cost. Anyways, it will not have a significant positive change on the exports because the demands are sluggish these days,” Mohanty added.
 
The mineral transport business has also been hit by suspension of several export trading licenses and ban on trader-to-trader sale of the mineral for transshipment by the government.
 
Meanwhile the railways and ports, facing slowdown in the ore traffic, have also reduced their tariffs.
 
On March 6 this year, the railways slashed rail freight charges by 16 per cent to Rs 2,425 per tonne, for ores meant for export purpose. Paradip port, the second largest iron ore exporting port in the country after Mormugao in Goa, reduced handling charges by a third to Rs 22 per tonne earlier this year to arrest slide in ore shipments.
 
However, the measures did not help much as the exports are falling due to poor Chinese demand.
 
As per the data available with the state steel and mines department, in the first quarter of the current financial year, traders in Joda mining circle lifted 57 per cent less iron ore for export purpose compared with the year ago period despite sharp rise in production.
 
In the same period, the ore exports from Paradip port also slumped to about 10-year low of 372,000 tonne, sources said.