Goa miners raise concern over possibility of export duty on low-grade iron ore

Panaji, Sep 14 (PTI) The Goa Mineral Ore Exporters' Association (GMOEA) on Sunday expressed concern over speculation about the possible extension of export duty to low-grade iron ore.

In a representation to the central government, the GMOEA urged it to reconsider any such move, claiming it could severely disrupt mining operations in Goa, where the iron ore is predominantly of low grade.

Given the region's unique mineral profile and the lack of domestic demand for such ore, GMOEA claimed that imposing export duties would not only jeopardise livelihoods and regional economic activity but also lead to stockpiling and wastage of a valuable natural resource.

The representation by GMOEA, representing key stakeholders in Goa's mining sector for more than 60 years, comes in response to recent media reports suggesting the possible extension of export duties to low-grade iron ores (below 58 per cent Fe).

The reports stemmed from deliberations held during the high-level stakeholders' meeting convened on August 26, focused on introducing reforms to enhance iron ore and steel production in India.

While the intent of the meeting was to address supply chain bottlenecks and support the steel sector which is laudable, GMOEA said there is a need to avoid unintended consequences for regions with distinct mineral profiles.

GMOEA also noted with appreciation the formation of the Advisory Committee, constituted on September 2, by the central government, to examine sectoral challenges with urgency and seriousness.

However, Item E of the committee's Terms of Reference, which reportedly considers the rationalisation of export policies, has sparked concerns that the export duty regime may be extended even to low-grade iron ore, the association said.

Goan iron ore, being predominantly low-grade, is largely unsuitable for domestic steelmaking, where higher-grade ore from eastern India or Bellary is preferred due to better cost efficiency. Its use in steel production raises costs, especially due to higher consumption of imported coking coal.

Additional logistics costs from Goa further reduce its competitiveness, even for exports, the association said.

The GMOEA said even local pig iron units mostly depend on imported or non-Goan ore.

"As a result, Goan iron ore has historically been export-oriented, with limited domestic demand. So extending export duties to Goa would offer minimal national benefit while imposing significant hardship on the state's mining sector," it claimed.

If an export duty is imposed, Goa could face a revenue loss of over Rs 800 crore annually at current production levels from just three operational mines, it added.

With more mines set to commence, this loss will multiply, discouraging participation in upcoming auctions, the association claimed.

The mine owners said avoiding such a duty will safeguard livelihoods, sustain mining viability, and uphold fair trade practices in a sector that remains in a fragile recovery phase.

The association pointed out that mining in Goa has only recently resumed under the auction regime.

"Of 12 auctioned blocks, 3 are operational, with more expected soon. Investors have made significant commitments towards compliance, employment, and logistics. A major steel company's participation in auctions affirms the process's credibility," it said.

The GMOEA said that according to the Ministry of Mines Annual Report 2025, India is 100 per cent self-sufficient in iron ore, with no shortage to meet its steel production goals.

"Also, due to minimal domestic demand for low-grade ore, mine-head stocks have risen from 126 million tonnes in 2020-21 to an estimated 180 million tonnes in 2024-25, which has also become an environmental concern," it pointed out.

At this critical phase, introducing an export duty risks disrupting the policy environment, affecting project viability, future bidding, state revenues, and ongoing operations, the GMOEA claimed. PTI RPS GK