India’s ministry of mines has amended pricing norms for low-grade iron ore, aiming to curb wastage, improve utilisation and ensure steady supply to the steel sector.
The ministry has notified the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession (Third Amendment) Rules, 2026 on April 10, introducing a methodology to determine the average sale price (ASP) for iron ore below the threshold grade.
The new framework covers ore with iron (Fe) content below 45 percent, including Banded Haematite Quartzite (BHQ) and Banded Haematite Jasper (BHJ), which are typically considered low-grade resources.
Under the revised norms, iron ore with 35-45 percent Fe content will be priced at 75 percent of the average sale price of iron ore with Fe content of 54-51 percent.
For iron ore with Fe content below 35 percent, the ASP shall be 50 percent below the ASP determined for iron ore with Fe content of 35-45 percent.
Earlier, in the absence of a separate pricing mechanism, the ASP for low-grade ore was aligned with higher-grade iron ore (45–51 percent Fe), making beneficiation economically unviable due to higher royalty and levy calculations. The revised rules aim to correct this distortion and incentivise the processing of low-grade resources.
The ministry noted that significant reserves of sub-threshold iron ore, including BHQ and BHJ formations, exist in India. With advancements in beneficiation technologies, these resources can now be upgraded into usable feedstock for the steel industry.
The amendment is expected to support mineral conservation, reduce pressure on high-grade reserves and ensure a steady supply of raw material for domestic steel production, thereby strengthening long-term resource security, the ministry said.
