- NMDC rolls over base price for auction
- Production at mines remains largely unaffected
Domestic low-grade iron ore fines (Fe 57%) prices remained flat this week in Karnataka’s Bellary region, with BigMint’s weekly index assessed at INR 3,150/tonne ($36/t) ex-mines Bellary (excluding taxes), unchanged w-o-w. Similarly, the Fe62% fines index stood at INR 5,000/t ex-mines Bellary (including taxes), though no deals were concluded at this level.
The market remains supported due a shortage of high-grade material, which has kept demand steady despite subdued trading. A Bellary-based miner told BigMint: “Continuous rainfall has disrupted supply chain operations, creating transportation bottlenecks and limiting material movement. The miner added that buyers are running out of inventory and willing to procure material, but logistical hurdles are preventing timely deliveries.”
In line with these challenges, overall market activity has slowed. A Bellary-based buyer noted, “Persistent rainfall over the past week has weighed on trade volumes, while another miner confirmed that production has remained largely unaffected, though dispatches continue to face difficulties”.
Auction activity was limited this week, with only a few direct deals being reported. Market participants highlighted that buyers are increasingly opting for direct purchases instead of participating in auctions due to dispatch-related concerns.
Meanwhile, NMDC rolled over its base price in the latest auction, adopting a cautious stance amid prevailing weather disruptions and weak movement. The rollover signals the miner’s effort to maintain stability in the market until logistical challenges ease and demand picks up.
Rationale
- No trade was recorded for Fe 57% in this publishing window, and hence, the T1 trade category was accorded 0% weightage.
- Sixteen (16) offers and indicative prices were reported, out of which fourteen (14) were considered as T2 trades. These were accorded 100% weightage.
Key Market Drivers
- NMDC’s auction receives decent response: NMDC’s recent iron ore auctions from its Donimalai and Kumaraswamy mines received decent response. On 19 August, Donimalai’s auction saw the entire 32,000 t of lumps (10-40 mm, Fe 55%) offered getting booked at INR 3,348/t ($38/t) and 16,000-t fines (Fe 56%) at INR 2,994/t ($34/t). Similarly, the 20 August auction from the Kumaraswamy mines recorded sales of 64,000 t of lumps (10-40 mm, Fe 59.35-59.71%) at a 4-7% premium over the base price of INR 4,300-4,404/t ($49-50), while 52,000 t of fines (Fe 60.4-60.72%) fetched up to a 4% premium over INR 3,883-3,960/t ($45/t). All prices are on an ex-mines basis and include royalty, DMF, and NMET.
- Bellary C-DRI prices up by INR 200/t ($2/t) w-o-w: Prices for sponge iron (CDRI) in Bellary increased by INR 200/t ($2/t) w-o-w. Market participants reported moderate trading activity, with prices supported by continuous rainfall and a shortage of good-quality coal in the region.
Karnataka iron ore sales scenario (15-21 August 2025)
Outlook
Karnataka’s low-grade iron ore prices are likely to remain range-bound in the near term, supported by tight availability of high-grade material and steady demand from sponge iron units. However, persistent rainfall is expected to keep logistics under pressure, thereby limiting trade volumes.
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