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There may finally be a bit of good news out there for companies heavily involved in mining iron ore such as Vale ADR (NYSE: VALE), BHP Billton ADR (NYSE: BHP), Rio Tinto ADR (NYSE: RIO) and Cliffs Natural Resources (NYSE: CLF).

These companies have suffered as benchmark iron ore prices tumbled 36% to their lows in the autumn at $116.75 a ton. Since then, prices have stabilized around the $140 a ton mark.

The good news is that, according to industry executives, India has raised export duties on iron ore to 30 percent. The recently announced rise in duties means that export duties are now six times higher than a year ago when they stood at just 5%.

This move by India, the third-biggest global supplier of iron ore, is likely to keep iron ore prices higher than they otherwise would be in the face of weakening demand. By the way, the two largest export countries for iron ore globally are Australia and Brazil.

The cost of iron ore is extremely important to the global economy because its price feeds directly into the price of steel which in turn flows directly in many everyday items such as cars and appliances.

Iron ore exports from India have fallen sharply in the past two years. Indian exports in the 2011 fiscal year were down 25% from 2010 levels, at about 80 million tons.

Sesa Goa, the country's leading iron ore exporter, estimates that in the fiscal year ending March 30, 2012, exports will be only 70 million tons. This implies a 30% drop in the January-March period from a year earlier.

Exports have fallen for a couple reasons. First, the Indian government is limiting iron ore exports in its quest to support the domestic steel industry.

The other reason that exports from India have fallen is that many Indian iron ore mines are high-cost and simply uneconomical at current iron ore prices.

The rise in India's export duties for iron ore is also just another sample of a growing global trend – resource nationalism. This is an attempt by governments to keep as much of their commodities wealth within their own borders for the benefit of domestic companies.

Arvind Mahajan of KPMG describes the attitude of the Indian government this way: “The view is that given that it's a natural resource of India, [the domestic] steel industry should have access to it.”

This longer-term trend is not good for any of the global natural resource companies.

Source: India Helps Push Up Iron Ore Prices