Goa's post-monsoon iron ore exports season has begun on a dull note, with hardly any significant shipments being booked to meet the overseas orders. That's a sea-change from the last few years, when the Mormugao Port witnessed a flurry of activity and the exporters booked berths and vessels days in advance to ensure timely dispatches of iron ore to feed the hungry steel mills across China and Japan. "We are witnessing negligible activity at our port ever since the export season began after rains recently," reveals Haresh Mel-wani of Nathurmal and Co, a midsized iron ore exporter. "Our company used to book four vessels a month until last year; today, we are down to just one. At this rate, Goa's iron ore exports could fall 30-40 per cent in 2008-09." That sounds scary, but likely. Already during July-September 2008, Goan iron ore exports totalled a meagre 1.1 million tonnes, against 1.6 million tonnes in the previous year. That may not be bad per se, but the trend seems to be worsening by the month. Consider this. During July 2008, Goa exported 7 lakh tonnes of iron ore against 4.5 lakh tonnes in July 2007. However, the shipments nosedived 64 per cent to 4.1 lakh tonnes during August-September 2008, against 11.5 lakh tonnes in the corresponding months of 2007. "This trend is likely to continue well into the rest of the year," laments Glenn Kalvampara, joint secretary, Goa Mineral Ore Exporters' Association (gmoea). Mining companies are quick to list the factors weighing down the iron ore exports, beginning with the slackening Chinese demand. For the past few years, Goa's iron ore exports have been driven by the unprecedented growth in Chinese steel production. In 2007-08, Goa exported 39 million tonnes of iron ore, with more than three-fourths shipped to China. Decline in demand Currently, however, much to the concern of Goan exporters, the demand from China has contracted considerably, after completion of the hectic infrastructure-building activity for the recently-concluded 2008 Olympic Games. "Chinese demand has dried up and the country has accumulated more than 70 million tonnes of unutilised iron ore at its ports, enough for at least three months' consumption," explains Rashid Khan, director, Trimurti Exports, which clocked Rs300 crore in exports in 2007-08. "This means that exports from India may begin to look up only after January 2009." While that sounds tentative, what is certain is a sharp decline in the demand for low-grade iron ore (56 to 58 per cent Fe content), the mainstay of Goan mining. Moreover, competition from Aus- * tralia and Brazil, coupled with the declining Chinese offtake, has led to a significant correction in prices. According to Melwani, prices of 58 grade from Goa have fallen to $50 per tonne f.o.b., from a high of $80 per tonne f.o.b. in early 2008, while prices of 63+ grade have crashed to $70 per tonne f.o.b., less than half the peak price of $145 per tonne f.o.b. in early 2008. Finally, Goan exporters are concerned about the worsening impact of the 15 per cent export duty on iron ore which New Delhi imposed in June 2008 to conserve the country's sufficient-yet-finite iron ore reserves. "The industry has been trying hard to convince the government that the export tax is hurting our operations, and its removal will provide a much-needed comfort zone to the iron ore exporters in this falling market," says Khan. Meanwhile, some analysts perceive the imminent slowdown to be a blessing in disguise, even as it impacts the bottomlines of mining companies in the short-term. Traditionally, Japan, South Korea and Taiwan have been the major markets for Goan miners who entered into the long-term, stable, fixed-price contracts with steel companies in these countries. Moreover, the boom of the past few years has enticed inexperienced, get-rich-quick players, who, many believe, have spoiled the market for the established companies, resorted to unscrupulous mining, and invited the ire of activists seeking a ban on the mining activity in Goa on environmental and related grounds. The recently-released Draft Regional Plan for 2021 advocated closure of several mining sites in Goa's forest areas, threatening the future of more than half the mines in the state. While that may be unpalatable for the industry, the slowing down of the Chinese market could actually bring about a shakeout, sparing the serious players and ensuring the sustainable mining practices in the years ahead.