State-run mining giant NMDC has successfully negotiated a 102 per cent hike in export prices of iron ore from Japanese and South Korean steel mills, notwithstanding the global financial downturn.
"NMDC will export iron ore lumps and fines at 96.5 per cent and 79.88 per cent higher prices, respectively, to foreign steel makers for a long-term supply of the raw material," Steel Secretary P K Rastogi told PTI.
Over and above the accepted hike for the current fiscal, the steel mills have also agreed to pay a bonus of 6 per cent on lumps from the Bailadila mines of NMDC, he added. That takes the hike to 102 per cent.
After the hike, the country's largest iron ore producer NMDC will now get $129 per tonne as export price instead of $65 earlier.
Of its total 30 million tonnes of production, the Navratna PSU exports about 3.5 million tonnes of iron ore to Japanese and South Korea steel companies including Posco.
The company has exported 1.5 million tonnes of the raw material, while the rest would be done till March.
"NMDC's price negotiation was due in April this year, but it got delayed due to some reason. The foreign steel companies will now pay price arrears," Rastogi said.
Enthused at the price negotiation, NMDC Chairman and Managing Director Rana Som said the Japanese and Korean steel companies made it clear that the concept of long-term contract is "independent of short-term fluctuations in prices".
