Karnataka: Iron ore prices stay supported w-o-w amid recovery in trades

• NMDC rolls over base prices for 13 May auction
  
  
• Pre-monsoon restocking support ore prices
  
  

Karnataka's domestic low-grade iron ore fines (Fe 57%) prices remained unchanged this week in Bellary. BigMint's weekly index for low-grade fines stood at INR 2,700/tonne (t) ($32/t) ex-mines Bellary (excluding taxes), stable w-o-w.

Similarly, the Fe62% fines index was assessed at INR 5,100/t ($60/t) ex-mines Bellary, including taxes. However, no deals were reported this week at the current offers.

Notably, National Mineral Development Corporation (NMDC), Karnataka, has released the base prices for its iron ore auction from the Donimalai mines on 13 May 2025. Prices for fines (-10 mm, Fe 58%) and lumps (10-40 mm, Fe 58%) have been kept unchanged at INR 3,932/t ($46/t) and INR 4,603/t ($54/t), respectively, from the last revision on 6 May. Prices are inclusive of royalty, DMF, and NMET.

Additionally, a couple of miners stayed out of the market as they await their consent to operate (CTO) for the current fiscal year. In the same line, a Bellary-based miner told BigMint, "We expect to receive DMGs consent to operate within a week, after which production will commence."

Another source from the region said, "With poor response to auctions, sales are entirely via direct mode. Market sentiment is strengthening ahead of monsoon restocking."

Iron ore e-auction sales volumes in Karnataka fell significantly by around 36% to 0.65 million tonnes (mnt) in April 2025 against 1.01 mnt in March 2025. Of the total volume sold in the month under review, fines accounted for 291,000 t (down 55% m-o-m), while lumps constituted 357,005 t (down 2% m-o-m). Notably, e-auction sales volumes fell to around a one-year low, according to data maintained by BigMint.

The decline in Karnataka's iron ore e-auction sales was driven by a combination of strategic shifts by miners towards direct sales, a persistent gap between bids and high base prices, and buyer preferences for more favourable alternatives, including NMDC's long-term agreements (LTAs), sources informed BigMint.

Rationale:

• Zero (0) trades were recorded for Fe57% in this publishing window, so T1 trade received 0% weightage.
  
  
• Nine (9) offers and indicative prices were reported, out of which eight (8) were considered as T2 trades. These were accorded 100% weightage.
  
  

Karnataka iron ore sales scenario (9-15 May 2025)

Outlook

Domestic low-grade iron ore prices in Karnataka are expected to stay firm in the near term, supported by supply shortages and NMDCs price rollover. Trading activity is also likely to remain strong, driven by a recovery in demand and active restocking ahead of the monsoons.