Imports plummeted 62.9% to 5.6 mt in 2015-16, compared to 15.1 mt in the year-ago period, according to an industry official in an iron ore firm.
These are slated to weaken further in 2016-17, amid higher domestic production forecasts.
In FY16, NMDC cut prices sharply, and hence, steel producers preferred the domestic material compared to imports.
“Easing domestic supply and subdued demand from the steel sector have provided sufficient volumes of the raw material to domestic steel producers. This has led to slowing imports of iron ore for the last couple of years due to mining restrictions. Given slowing steel demand and oversupply in the iron ore market, India’s iron ore imports are expected to see a declining trend,” the official said.
Global iron ore prices are likely to hover in the range of $50-65 a ton.
Global iron ore prices remained weak for most part of the last fiscal except February when some uptick in demand was noticed. Globally, iron ore prices slumped by 35% between June 2015 and January 2016.
Total global iron ore production in 2015 stood at over 2,300 mt but demand subsided, leading to global oversupply of around 50 mt. Iron ore costs are expected to fall further in this fiscal as big miners like Vale, Rio Tinto and BHP Billiton would add 90 mt of incremental production.