Union Cabinet Chaired by Prime Minister Narendra Modi has approved the renewal of Long Term Agreements (LTAs) for
supply of iron ore (lumps and fines) of grade +64% Fe content to
Japanese Steel Mills (JSMs) and POSCO, South Korea for another five years up to March 2023 through the state owned
Minerals Metals Trading Corporation Limited.
present Long Term Agreements are valid until March 31 this year. The renewed
LTAs with steel mills of Japan and POSCO, South Korea shall be for a period of
five years from 1.4.2018 to 31.3.2023.
range of quantity of iron ore to be exported under LTA per annum shall be 3.80
million tons (min.) per annum to 5.50 million tons per annum (max.) of both
NMDC and non-NMDC origin iron ore with quantitative ceilings for export of
Bailadila Lumps at 1.81 million MTs per annum and Bailadila Fines at 2.71
million MTs per annum.
The quantities of iron ore proposed for supply to JSMs
and POSCO, South Korea through MMTC Limited under these LTAs will be of grade
+64% Fe content. The break up is as follows:-
Japanese Steel Mills
3.00 ~ 4.30 million tons per
POSCO, South Korea
0.80 ~1 .20 million tons per
existing policy of single agency operation and exports through MMTC, with
trading margin of 2.8 per cent of FOB price, shall be continued.
iron ore under the LTAs would help to strengthen India’s bilateral ties with
long-standing partner countries, Japan and South Korea secure an export market
and result in inflow of foreign exchange.
agreement will enable India to secure international market for its ores and
ensure stable economic ecosystem which provides direct and indirect employment
in mining, logistics and related sectors.
The history of India's iron ore
exports to Japan is almost six decades old and is a consistent component of
India's bilateral relations with Japan. MMTC has been supplying iron ore to Japanese
Steel Mills since 1963 and to South Korea since 1973.
The current LTAs with Japanese
Steel Mills (JSMs) and POSCO, South Korea, for supply of iron ore for a period
of three years will expire on 31st March, 2018. The Cabinet, in its
meeting held on April 24 had authorized MMTC Limited to engage in Long Term Agreements(LTAs)
with Japanese Steel Mills (JSMs) and POSCO, South Korea, for supply of iron ore
for a period of three years (i.e. 2015 to 2018).