NEW DELHI, June13:  As domestic iron ore output is on the wane, industry body Assocham today suggested the Commerce Ministry to prune import duty on the key steel-making input to nil and treble levy on pellet exports to 15 per cent.
“The drop in domestic iron ore production is forcing the steel industry to import iron ore from international market… It is suggested that government may consider reducing import duty on iron ore to zero from the currently levied 2.5 per cent,” Assocham said in a memorandum to Commerce Minister Nirmala Sitharaman.
Country’s iron ore production has come down to an all-time low of 144 million tonnes (MT) in FY’14 from the peak level of 218 MT in FY’10. The production is expected to drop further to a level of 90-95 MT in the current fiscal due to the recent order of the Supreme Court in case of Odisha state, it said.
India’s annual steel production capacity now stands at around 100 MT and is expected to treble in next 10-15 years. It requires around 1.6 tonnes of iron ore to produce one tonne of steel.
Pointing at the anomaly in the duty structure of iron ore and pellets, an agglomerated form of the input, Assocham said presently, exports of pellets attract 5 per cent duty whereas exports of iron ore fines and lumps attract 30 per cent.
“Therefore, exporters are circumventing the exports of iron ore through pellets by paying only 5 per cent export duty. The pellet export in 2012-13 was nil, while in the year 2013-14, the pellet export was 1.5 MT,” it said.
Stating that export of pellets is draining mineral wealth of the country, export of steel would have been a better value proposition which would not only add extra value to the input but also create avenues for employment and revenue generation.
“Assocham had proposed to levy an export duty of 30 per cent on pellets, however, the government may consider to increase it to at least 15 per cent in the upcoming budget and later on it can be increased to 30 per cent,” the statement said. (PTI)

NEW DELHI, June 13: Silver prices moved up by Rs 140 to Rs 41,499 per kg in futures trade today after investors created positions largely driven by a firming trend overseas.
At the Multi Commodity Exchange, silver for delivery in far-month September moved up by Rs 140, or 0.34 per cent, to Rs 41,499 per kg in business turnover of 18 lots.
On the similar lines, the white metal for delivery in July month contracts rose by Rs 122, or 0.30 per cent, to Rs 41,373 per kg in 287 lots.
Market analysts attributed the rise in silver prices at futures trade to a firming trend in the global markets on concerns that a US recovery may be stalling.
Silver rose as much as 0.50 per cent to USD 19.63 an ounce in Singapore today, the highest since May 26. (PTI)

NEW DELHI, June 13:  Gold rose 0.19 per cent to Rs 26,448 per 10 grams in futures trade today as participants engaged in enlarging positions on a firming trend overseas.
At the Multi Commodity Exchange, the metal for delivery in far-month October gained Rs 49, or 0.19 per cent, to trade at Rs 26,448 per 10 grams in a turnover of four lots.
Similarly, the metal for delivery in August moved up by Rs 34, or 0.13 per cent, to Rs 26,364 per 10 grams, clocking a business volume of 136 lots.
Analysts said the rise in global markets on concerns that a US recovery may stall and violence in Iraq will escalate boosted safe-haven demand and supported the rise in gold prices at futures trade here.
Globally, gold climbed 0.20 per cent to USD 1,275.65 an ounce in Singapore today, the highest level since May 27. (PTI)

NEW DELHI, June 13:  Crude oil futures rose 1.13 per cent to Rs 6,361 per barrel today as speculators created fresh positions amid a firming trend in Asia.
At the Multi Commodity Exchange, crude oil for delivery in June gained Rs 71, or 1.13 per cent, to Rs 6,361 per barrel, with a business turnover of 2,056 lots.
The oil for July delivery also moved up by Rs 70, or 1.12 per cent, to Rs 6,342 per barrel in a turnover of 359 lots.
Marketmen said the rise in crude oil futures was largely in tandem with a firming trend in Asia on concerns about the growing crisis in Iraq that fuelled fears over supplies from the major crude producer.
Meanwhile, West Texas Intermediate (WTI) crude oil advanced 73 cents to USD 107.26 per barrel in late morning Asian trade, after surging USD 2.13 in New York yesterday to reach its highest level since September. (PTI)

NEW DELHI, June 13:  The ‘El Nino’ risk is expected to keep inflation elevated and RBI on a “long hold” as the first rate cut by the central bank is likely in early 2015 rather than this December, says a report.
El Nino, which refers to warmer-than-average sea surface temperatures in the central and eastern tropical Pacific Ocean, will likely to keep CPI inflation up at 8-10 per cent in the second half of 2014 and will pose a 50-70 basis point risk to this fiscal’s growth expectation, the report by financial services major Bank of America Merrill Lynch said.
El Nino occurs every four to 12 years and had last hit India’s monsoon in 2009, leading to the worst drought in almost four decades.
“If rains are normal, CPI inflation should drop to 7-7.5 per cent by March 2015. If the El Nino impacts the kharif harvest, rising food prices could push up CPI inflation to 8 -10 per cent, essentially irrespective of monetary policy action,” the report said.
The Indian Meteorological department early this week cut its June-September monsoon forecast to 93 per cent of the long-run average from an already below-normal 95 per cent projected earlier.
The chance of an El Nino during the monsoon has also been hiked to more than 70 per cent, from 60 per cent.
“We continue to expect the RBI to remain on long hold. An El Nino will likely push the first rate cut to early 2015 from December,” the report said.
However, the report said the picture is likely to be clear only around July. A five per cent change in food prices impacts CPI inflation by 250 basis points.
The report estimates that an El Nino poses a 50-75 basis points risk to its 5.4 per cent FY14 growth forecast.
The Reserve Bank on June 3, left key rates unchanged and unlocked about Rs 40,000 crore of Funds by reducing the amount of deposits banks are required to park in government securities.
This was the second time in a row that interest rates have been left unchanged amid demands for moderation to spur growth. (PTI)