India’s iron ore pellet makers seek curbs on Iranian imports via Oman

By Admin

10 Jul, 2025

Surging Imports Threaten Domestic Industry

India’s iron ore pellet manufacturers are urging the government to step in and restrict a rising wave of imports, allegedly of Iranian origin, being routed through Oman. Industry sources and analysts warn that these low-cost imports could disrupt the domestic market and undermine local manufacturers who are already operating below optimal capacity.

Sanctions Evasion in Question

Though officially imported from Oman, there are serious doubts about the true origin of the iron ore pellets. “Even though pellet imports were shown to originate from Oman, there were doubts on the actual country of manufacture/origin as it is understood that this country does not produce pellets,” said the Pellet Manufacturers Association of India (PMAI) in a letter to the Ministry of Steel.

Analyst Lalit Ladkat of the London-based CRU Group confirmed that most of the imports are indeed of Iranian origin and are being shipped via Oman to skirt around U.S. sanctions. Notably, the U.S. had imposed sanctions on Iran’s industrial metals sector in 2019 under the administration of President Donald Trump, with the goal of limiting Iran’s export revenues.

Sharp Increase in Imports Since 2021

India, the world’s third-largest iron ore producer, had negligible pellet imports between 2021 and 2024. However, that trend changed drastically in 2025. “India has imported about 800,000 metric tons of iron ore pellets so far this year,” said Ladkat. The spike is being attributed to a combination of higher domestic prices and the availability of cheaper, high-quality Iranian pellets.

Domestic Production Takes a Hit

The PMAI has warned that this surge in imports is straining local businesses, with manufacturers currently operating at only 69% of their capacity. “Oman as a country of origin is doubtful,” said Manish Kharbanda, president of PMAI, reinforcing the association’s position that the imports may be violating international trade norms.

Government Review Underway

India’s Ministry of Steel has acknowledged receipt of a petition from domestic pellet makers and is currently reviewing the issue. However, no official comments have been made public as of now, and the ministry has not responded to media queries.

Iron Ore and Steel Demand on the Rise

The timing of the import surge is especially concerning given the rising demand for steel in India, fueled by growth in sectors such as infrastructure, construction, and automotive. Between April and May 2025, India’s finished steel consumption hit 25.1 million metric tons up 7.1% compared to the same period last year. Crude steel production also saw a 9.5% increase, reaching 26.9 million metric tons.

The Way Forward

As India continues its journey toward becoming a global manufacturing hub, protecting domestic industries from unfair trade practices is crucial. The outcome of the ministry’s investigation will likely determine the future course of action. For now, the spotlight remains on ensuring transparency, fair competition, and strict adherence to international sanctions.