- NMDC rolls over iron ore base price
- Auctions fail to secure higher bids
Iron ore prices in Karnataka registered a week-on-week decline, weighed down by weak market sentiment, early arrival of monsoons in the region, limited trade activity, and softening offers by select miners. Demand from the downstream steel sector remained sluggish, further dampening overall market dynamics.
Despite logistical challenges due to the ongoing monsoon, buying interest stayed subdued as most participants opted for a wait-and-watch approach. A key buyer told BigMint, “Iron ore prices in Karnataka are expected to drop by INR 300-400/tonne (t) ($4-5/t) in the near term, driven by muted buying interest and persistent market weakness.”
Domestic low-grade iron ore fines (Fe 57%) prices in Karnataka’s Bellary region witnessed a marginal drop this week. BigMint’s weekly index for low-grade fines (Fe 57%) decreased w-o-w by INR 50/t ($1/t) to stand at INR 3,050/t ($36/t) ex-mines Bellary (excluding taxes).
Similarly, the Fe 62% fines index also fell to INR 5,100/t ($60/t) ex-mines Bellary, inclusive of taxes, a fall of INR 150/t ($2/t), w-o-w. Additionally, some offers were seen at higher levels. Despite ongoing supply concerns in the region, no deals were finalized for either of the offers.
However, the National Mineral Development Corporation (NMDC) has held its iron ore prices steady, offering some support to domestic market levels amid selective procurement. That said, recent auctions from NMDC’s Donimalai mines and Karnataka State Minerals Corporation Ltd (KSMCL) failed to garner strong response, with bids remaining subdued.
NMDC conducted an auction for 40,000 t of iron ore from its Donimalai mines, Karnataka on 24 June 2025. The total quantity, comprising 8,000 t lumps (10-40 mm, Fe 56%) and 32,000 t fines (Fe 56%), was booked at the base prices of INR 4,012/t ($47/t) and INR 3,456/t ($40/t), respectively. Prices include royalty, DMF and NMET charges.
Meanwhile, KSMCL auctioned 192,000 t iron ore on 25 June 2025, with 72,000 t sold. Only, 48,000 t of fines (Fe 62.54-64.3%) were booked at INR 4,546-4,634/t ($53-54/t) against base prices of INR 4,536-4,591/t ($53-54/t). Meanwhile, 24,000 t of lumps (10-40 mm, Fe 64.3%) were sold at INR 5,278-5,288/t ($62/t) against a base price of INR 5,278/t ($62/t). Prices are on ex-mines basis, exclusive of royalty, DMF, and NMET.
Rationale
- No trade was recorded for Fe 57% in this publishing window and was accorded with 0% weightage.
- Thirteen (13) offers and indicative prices were reported, out of which eleven (11) were considered as T2 trades, receiving 100% weightage.
Karnataka iron ore sales scenario (20-26 June, 2025)
Additionally, BigMint’s sponge CDRI prices, exw-Bellary, remained stable w-o-w on 26 June 2025. Market sentiment remained cautiously optimistic, driven by expectations of a potential uptrend in prices and a stabilization in demand. This development suggests a shift towards improved market participation, especially in the semi-finished materials segment.
Outlook
Although supply concerns have so far supported Karnataka’s iron ore prices, the early onset of monsoons is likely to impact overall market dynamics. Rain-induced disruptions are expected to hamper mining activity, leading to reduced production, logistical challenges, and lower trade allocations. As a result, prices are also expected to remain volatile in the near term.
Leave a Reply