KOLKATA (miningweekly.com) - In the wake of falling commodity prices and export volumes, India was looking to increase shipments to Japan and South Korea under existing three-year bi-lateral contracts.

According to a senior government official, the Commerce Ministry, which oversees the bi-lateral long-term iron-ore agreements, has veered around to recommendations from the Mines Ministry that with a higher number of iron-ore mines getting back into production product shipments to Japan and Korea could be increased.

Indian iron-ore exports to Japan and South Korea were governed by the long-term agreements between the respective countries and shipments were carried out by India’s largest iron-ore miner, NMDC Limited.

In October, the Commerce Ministry received requests from the governments of Japan and South Korea to revise the long term agreements signed earlier in the year, and increase high grade iron-ore shipments to levels of around 20-million to 25-million tonnes over the next three years, up from the 16.5-million tonnes until 2018 as envisaged in the agreement.

The official said that considering the fact that both Japan and South Korea were important trading partners, both the Mines and Commerce Ministries were receptive towards a revision of the long-term agreements and increase Indian exports to these countries.

The decision to hike iron-ore exports to Japan was also boosted by the visit of Japanese Prime Minister Shinzo Abe this week, leading to strategic bi-lateral relationships and signing of several economic co-operation agreements between the two countries.

The Steel & Mines Ministry has maintained that under the changed supply-demand dynamics with more mines getting back into operations in Goa and Karnataka, and the increased availability of product, opposition from local steel mills to higher overseas shipments would be muted.