India’s Ministry of Mines has announced new pricing rules for low-grade iron ore in a move aimed at increasing raw material availability for domestic steel producers.
The revised framework, introduced under the Minerals Concession (Third Amendment) Rules, 2026, establishes a separate average sale price (ASP) methodology for iron ore with less than 45% iron (Fe) content, including low-grade resources such as Banded Haematite Quartzite (BHQ) and Banded Haematite Jasper (BHJ).
Under the new rules:
- Iron ore with 35%–45% Fe content will be priced at 75% of the ASP for ore graded 51%–54% Fe
- Iron ore with below 35% Fe content will be priced at 50% below the ASP for the 35%–45% category
Previously, low-grade ore was priced in line with higher-grade material, making beneficiation commercially unattractive due to royalty and levy costs.
The government said the reform is expected to:
- Reduce wastage of mineral resources
- Encourage beneficiation and processing
- Ease pressure on high-grade reserves
- Ensure stable supply to India’s steel sector
The move comes as India seeks to secure long-term raw material resources amid rising steel demand.
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