Indian Express reported that Iron ore exporters are facing a serious financial turbulence as not only have ore prices plunged to nearly USD 50 a tonne, the letters of credit issued by their Chinese buyers are bouncing.

The report cited Mr Rahul N Baldota president of Federation of Indian Mineral Industries as saying that “It is serious problem as a number of the LCs given to us by our Chinese buyers have bounced back. In the Bellary Hospet sector alone, most exporters have been hit by nearly INR 250 crore during the past few months.”

He said that “When the Chinese buyers negotiated deals, ore prices were high. Now there is a sudden slide in ore prices and the buyers are understood to be reluctant.”

Mr Baldota said that “If this situation continues, we might ultimately have to seek the Government intervention.”

He said that almost all miners in Hospet Bellary region have been hit and if these trend continues, then there would be severe problems including production cuts and subsequent job losses.