- NMDC retains base prices in latest auction
- Rainfall affects 8-10% of regional production
Domestic low-grade iron ore fines (Fe 57%) prices remained stable this week in Karnataka’s Bellary region. BigMint’s weekly index for the same (Fe 57%) stood unchanged at INR 3,150/tonne (t) ($36/t) ex-mines Bellary (excluding taxes), steady w-o-w.
Stable sponge iron and pellet prices underpinned iron ore tags in Karnataka. NMDC retained its base prices in the latest auction, with the Donimalai mines auction seeing decent participation. Market sentiment remained buoyed by consistent demand and firm pricing trends.
Similarly, the Fe 62% fines index was assessed at INR 5,250/t ($60/t) ex-mines Bellary, including taxes, maintaining stability w-o-w. Limited availability of high-grade material continued to support prices in the region. A major Indian steel mill booked imported iron ore fines from Brazil, given the tight availability of high-grade fines in the domestic market.
However, no transactions were concluded this week, and other miners’ auctions witnessed weak participation. Market participants highlighted subdued buying interest across the region.
According to sources, blast furnace operators are continuing procurement out of necessity, whereas sponge iron producers — who are not facing any operational constraints now — are refraining from purchases, citing the impact of seasonal rains on demand.
A Bellary-based miner stated, “Rainfall in the region has had some impact on output, affecting 8-10% of production, thereby contributing to price stability in the market.”
NMDC has rolled over its base prices for its iron ore auction from the Donimalai mines in Karnataka. Prices of fines (-10 mm, Fe 56%) stood at INR 2,989/t ($34/t), while lumps (10-40 mm, Fe 54%) were at INR 3,348/t ($38/t). Prices include royalty, DMF, and NMET. The miner has again reduced its grade of lumps.
Rationale
- No trade was recorded for Fe 57% in this publishing window, and hence, the T1 trade category was accorded 0% weightage.
- Fifteen (15) offers and indicative prices were reported, out of which eleven (11) were considered as T2 trades receiving a 100% weightage.
Factors supporting low-grade offers
- NMDC Donimalai auction sees decent response: NMDC conducted an auction for 48,000 t of iron ore from its Donimalai mines, Karnataka, on 12 August 2025. The entire 32,000 t offered of fines (Fe 56%) were booked at INR 3,007/t (at a premium of INR 18/t). Notably, around 16,000 t of lumps (Fe 54%, 10-40 mm) failed to attract buyers and remained unsold. Prices are on ex-mines basis and include royalty, DMF, and NMET.
- Low-grade export prices increase w-o-w: BigMint’s bi-weekly Indian low-grade iron ore fines (Fe 57%) export index rose by $1.5/t w-o-w to $65.5/t FOB east coast on 14 August. A 60,000-t fines export (Fe 57%) deal was recorded at $77/t CFR China in this publishing window. The rise was supported by improved global market sentiment and stronger Chinese demand, with market participants noting increased procurement activity by Chinese mills, creating a favourable environment for Indian exporters.
Karnataka iron ore sales scenario (8-14 August 2025)
Outlook
Iron ore prices in Karnataka are expected to remain stable in the near term, supported by limited material availability and steady sponge iron and pellet tags. Slight production disruptions from rainfall are likely to maintain supply consistency. However, muted domestic transactions and weak participation in certain auctions may cap upside potential. Strengthening export demand, driven by Chinese procurement, could offer additional price support.
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