- Fines continue to dominate buyer preference
- Downstream sentiment turns marginally positive
Iron ore e-auction sales in Karnataka staged a strong recovery in December 2025, surging 23% m-o-m to 1.24 million tonnes (mnt) from 1.01 mnt in November, as per data maintained by BigMint. The sharp rebound was largely driven by improved participation from secondary steelmakers and sponge iron producers, who returned to auctions amid marginally better finished steel realizations.
While overall buying sentiment remained guarded, the slightly improved downstream outlook was sufficient to unlock deferred procurement and lift auction offtake. Buyers selectively stepped in to cover near-term requirements, translating into a notable rise in traded volumes.
Of the total auctioned quantities, iron ore fines accounted for 521,000 tonnes, while lumps stood higher at 718,000 tonnes. The sustained preference for fines underscores end-users’ focus on cost efficiency, as tight margins and cautious procurement strategies continued to dominate buying behaviour.
Demand sentiment improves; pricing and availability provide support
The rise in e-auction volumes was underpinned by a modest yet visible improvement in finished steel demand. This encouraged sponge iron units and secondary steelmakers to replenish raw material inventories after weeks of restrained buying. Although demand momentum remained far from robust, improved steel price realizations injected sufficient confidence for buyers to actively participate in auctions rather than postpone purchases.
In addition, availability of auctioned material particularly fines combined with competitive pricing levels, enabled buyers to secure supplies without aggressive stocking. Routine month-end procurement, coupled with the need to maintain uninterrupted plant operations, further strengthened December’s auction volumes.
NMDC tightens grip on Karnataka auctions
NMDC, India’s largest iron ore miner, further consolidated its dominance in Karnataka’s e-auction market, recording robust sales of 1.03 mnt in December 2025. The volumes comprised 692,000 tonnes of fines and 338,000 tonnes of lumps, reflecting a strong 26% m-o-m jump from 818,000 tonnes sold in November.
Market participants noted that several blast furnace operators despite limited market activity stepped in to procure NMDC material to meet immediate and unavoidable raw material requirements. NMDC’s consistent supply, assured quality, and competitive pricing provided a firm anchor to overall auction volumes during the month.
Other miners report mixed trends
Sandur Manganese and Iron Ore Limited (SMIORE) emerged as the second-largest seller, posting sales of 97,000 tonnes in December, comprising 95,000 tonnes of lumps and 2,000 tonnes of fines. This marked a sharp hike of 90% m-o-m from 51,200 tonnes in November, supported by improved sponge iron prices, which revived demand for lumps.
Vedanta ranked third with sales of 72,000 tonnes, entirely lumps-based. However, volumes declined 25% m-o-m from 96,200 tonnes in November, as the miner offered comparatively lower material during the month.
Meanwhile, Karnataka State Minerals Corporation Limited (KSMCL) reported softer performance, with sales slipping to 40,000 tonnes in December comprising 24,000 tonnes of fines and 16,000 tonnes of lumps down from 48,000 tonnes in the previous month.
Auctions conducted by BKG Mining and U Krishna Prasad Company once again failed to attract buyer interest, highlighting highly selective procurement behaviour and lingering caution among market participants despite improving sentiment.
Iron ore prices soften m-o-m, aiding buyer participation
Iron ore prices moved lower in December, with monthly weighted average prices of both Fe 60% fines and Fe 63% lumps declined m-o-m. Weighted average prices of Fe 60% fines fell by INR 200/t to INR 3,100/t, while Fe 63% lumps also dropped by INR 200/t to INR 4,600/t. Prices are exclusive of taxes.
The price correction was driven by a softer base price environment, which opened a favourable buying window for end-users. Capitalising on the dip, buyers actively booked material at these levels to cover short-term requirements. The lower pricing not only supported higher auction participation but also reinforced disciplined, value-driven procurement amid lingering uncertainty in downstream demand.
Outlook
Karnataka’s iron ore e-auction volumes are expected to remain supportive in the coming month, backed by gradually improving downstream demand and expectations of further recovery in finished steel consumption. Market participants anticipate that miners who remained inactive or offered limited volumes in December are likely to re-enter auctions, adding depth to supply and sustaining healthy trade volumes in the near term.
Leave a Reply