High volumes of iron ore being shipped to China

Viet-Trung Metallurgy and Mineral Refining Company (VTM) in the northern province of Lao Cai has been exploiting the iron ore from Quy Sa mine for export to China in increasingly large volumes, according to a source from the Vietnam Steel Association.

An official of the association told the Daily on Tuesday that for nearly two years, VTM has exported the exploited iron ore from Quy Sa mine to China in huge amounts of some 500,000 tons each year.

Quy Sa is the second biggest iron ore mine in Vietnam with total reserve of 120 million tons after Thach Khe in Ha Tinh Province which has a total reserve of 450 million tons.

The official said the iron ore export of VTM was approved by the Ministry of Industry and Trade. The joint venture ships iron ore to China for the exchange of coal to bring back to Vietnam.

VTM is a joint venture established by Vietnam Steel Corporation, Lao Cai Mineral Company and the China-based Kunming Iron Group. The joint venture was established for carrying out the Lao Cai steel project with total investment of US$300 million.

“In recent years, several enterprises have sought to exploit and export iron ore to other countries, but the association has never agreed to help curb the flow of country’s coarse ores to other countries,” the source said.

The association’s official said that the uncontrolled exploitation and export of the country’s iron ores has been depleting national resources as well as causing environmental pollution.

Lao Cai steel project started construction in 2008 but had been delayed until the joint venture signed an agreement with VietinBank-Lao Cai for a VND2.2 trillion credit for the steel project. The facility is expected to be operational by late 2012 with a production output of 500,000 tons of ingots a year.

According to the association, domestic enterprises now need over 1.8 million tons of iron ore for their annual production, and the demand for iron ore of the country is increasing because there will be more iron casting companies to be established in the future.

“If the iron ore is still allowed for export, then the domestic iron casting companies will face a serious shortage of iron ore because the country’s iron ore is limited,” Pham Chi Cuong, chairman of the steel association, said in a document that was sent to the Government and related ministries to suggest banning the export of iron ore.

Tags: Vietnam iron ore exports