India's decision to impose an export tax on iron ore has taken its toll on shipments of the commodity.
Recent media reports said the country's iron ore export to China has slumped by 26.5 per cent in August to 4.59 million tonnes, lowest monthly level since October last year, as compared to July.
Moreover, the decline is continuing after the Centre imposed the export tax this year.
Iron ore exports to China in August hit their lowest monthly level since October 2006.
China's total August imports were down by 12.8 per cent from July at 29.29 million tonnes, with shipments declining from most major supplying countries.
The iron ore export to China has declined by 26.5 per cent in August compared with July when the country shipped 6.2 million tonnes to its neighbour. The volumes have been steadily dropping since the Central government introduced an export tax in March.
During January-August, India exported a total of 56.19 million tonnes to China, a 5 per cent growth as compared with the same period in 2006.
Brazil and Australia have outpaced this growth at 27 per cent and 14 per cent respectively.
As Indian monsoon season traditionally impact China's import during September and October, prices may be set to skyrocket even further above the current $155 a tonne.
However, Chinese traders comment that such high prices are unacceptable and that buying activity is declining as a result.
