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Iron Ore to Steel Value Chain Economics — India (2024-2026)
Research compiled: March 2026 For: SeeUtkal economics chapter on Odisha’s mineral value chain
1. PRICE AT EACH STAGE (Rs per tonne, excl. GST unless noted)
Stage 1: Iron Ore (Mine-gate / Pit-mouth)
NMDC prices (FOR basis, inclusive of Royalty + DMF + NMET):
| Product | Grade | Oct 2024 | Jun 2025 | Nov 2025 | Mar 2026 |
|---|---|---|---|---|---|
| Lumps (Baila) | 65.5% Fe, 10-40mm | 6,350 | 6,300 | 5,600 | 4,800 |
| Fines (Baila) | 64% Fe, -10mm | 5,410 | 5,350 | 4,750 | 4,050 |
Odisha mine-gate prices (ex-mine, merchant miners):
| Product | Grade | Price Range (Rs/t) | Period |
|---|---|---|---|
| Fines | 55-58% Fe | 3,322 - 3,891 | Dec 2024 - Dec 2025 |
| Fines | 58-60% Fe | 3,768 | Jan 2026 |
| Fines | 60-62% Fe | 4,537 | Dec 2024 |
| Fines | 62% Fe (index) | 5,300 - 5,750 | Oct - Dec 2025 |
| Concentrate | Avg sale price | 3,643 - 3,651 | Sep - Oct 2025 |
OMC (Odisha Mining Corp) auction prices: Rs 3,150 - 5,800/t for fines (Fe 54-65%), Oct 2024
Sources: CEIC/Indian Bureau of Mines, BigMint, NMDC price notifications
Stage 2: Beneficiated Iron Ore / Concentrate
| Product | Price (Rs/t) | Source |
|---|---|---|
| Iron ore concentrate (avg sale price, all-India) | 3,643 - 3,651 | Indian Bureau of Mines via CEIC, Sep-Oct 2025 |
Note: Beneficiation adds ~Rs 300-800/t in processing cost to upgrade low-grade fines (below 58% Fe) to 62-63% Fe concentrate. This is typically done via washing, jigging, or magnetic separation.
Stage 3: Iron Ore Pellets
| Location | Grade | Price (Rs/t) | Period |
|---|---|---|---|
| Raipur (BigMint PELLEX index) | Fe 63% | 9,700 DAP | Nov 2025 |
| Raipur (producer offers) | Fe 63/63.5% | 9,850 - 9,900 | Oct 2025 |
| Raipur (Ayron Mart) | — | 25,500 | Mar 2026 |
| Raigarh | — | 25,100 | Mar 2026 |
| Durgapur | — | 26,400 | Mar 2026 |
| Bellary | — | 27,400 | Mar 2026 |
| Hyderabad | — | 27,900 | Mar 2026 |
IMPORTANT NOTE: There is a significant discrepancy between the BigMint PELLEX index (Rs 9,700/t, Nov 2025) and the Ayron Mart quotes (Rs 25,000-28,000/t, Mar 2026). The BigMint figure likely reflects ex-works/ex-plant pricing for bulk contracts of standard-grade pellets, while the Ayron Mart figures may include higher-grade pellets, transport, and trader margins — or possibly reflect a different pellet specification. The BigMint PELLEX figure of ~Rs 9,700-10,000/t is more consistent with industry cost economics and should be used as the benchmark for bulk pellet pricing.
Stage 4: Sponge Iron / DRI (Direct Reduced Iron)
| Location | Price (Rs/t) | Period |
|---|---|---|
| Raipur | 22,900 (low) / 27,500 | Apr-Sep 2025 / Mar 2026 |
| Raigarh | 26,800 | Mar 2026 |
| Rourkela (Odisha) | 27,100 | Mar 2026 |
| Durgapur | 28,600 | Mar 2026 |
| Mandi Gobindgarh | 32,500 | Mar 2026 |
| Bellary | 27,800 | Mar 2026 |
| Jaipur | 32,300 | Mar 2026 |
Benchmark (Raipur, Mar 2026): Rs 27,500/t
Stage 5: Pig Iron
| Location | Grade | Price (Rs/t) | Period |
|---|---|---|---|
| Rourkela (Odisha) | Steel grade | 36,900 | Mar 2026 |
| Raipur | Steel grade | 37,200 | Mar 2026 |
| Bokaro | Steel grade | 37,200 | Mar 2026 |
| Durgapur | Steel grade | 37,500 | Mar 2026 |
| Raigarh | Steel grade | 37,900 | Mar 2026 |
| Mandi Gobindgarh | Steel grade | 41,600 | Mar 2026 |
| Ludhiana | Steel grade | 39,600 | Mar 2026 |
| Durgapur | Foundry grade | 41,500 | Mar 2026 |
| Mandi Gobindgarh | Foundry grade | 42,000 | Mar 2026 |
| Ludhiana | Foundry grade | 43,000 | Mar 2026 |
| Delhi | — | 46,020 | Apr 2025 |
| Kolkata | — | 42,730 | Apr 2025 |
Benchmark (Raipur steel grade, Mar 2026): Rs 37,200/t
Stage 6: Crude Steel / Billets / Ingots
Billets (Mar 2026):
| Location | Price (Rs/t) |
|---|---|
| Rourkela (proxy: ingot) | 38,800 |
| Raipur | 40,800 |
| Raigarh | 39,950 |
| Durgapur | 40,600 |
| Kolkata | 41,600 |
| Mumbai | 44,250 |
| Chennai | 45,750 |
| Ahmedabad | 44,700 |
| Ludhiana | 44,600 |
Benchmark (Raipur, Mar 2026): Rs 40,800/t
Ingots (Mar 2026):
| Location | Price (Rs/t) |
|---|---|
| Rourkela | 38,800 |
| Raipur | 40,300 |
| Raigarh | 39,600 |
| Durgapur | 39,900 |
| Mumbai | 43,650 |
Stage 7: Hot Rolled Coil (HRC)
| Location | Price (Rs/t) | Period |
|---|---|---|
| Kolkata | 53,600 | Mar 2026 |
| Ludhiana | 56,500 | Mar 2026 |
| Delhi | 56,500 | Mar 2026 |
| Jaipur | 56,500 | Mar 2026 |
| Hyderabad | 56,500 | Mar 2026 |
| Ghaziabad | 57,000 | Mar 2026 |
| Ahmedabad | 57,500 | Mar 2026 |
| Chennai | 57,800 | Mar 2026 |
4QFY26 avg HRC price: Rs 52,860/t (up 12% over 3Q avg of Rs 47,100/t)
Benchmark (all-India avg, Mar 2026): Rs 55,000-57,000/t
Stage 8: Cold Rolled Coil (CRC)
| Location | Price (Rs/t) | Period |
|---|---|---|
| Kolkata | 59,000 | Mar 2026 |
| Jaipur | 61,500 | Mar 2026 |
| Delhi | 62,800 | Mar 2026 |
| Ludhiana | 63,100 | Mar 2026 |
| Hyderabad | 63,300 | Mar 2026 |
| Ahmedabad | 64,600 | Mar 2026 |
| Mumbai | 65,000 | Mar 2026 |
| Ghaziabad | 66,000 | Mar 2026 |
Benchmark (all-India avg, Mar 2026): Rs 62,000-65,000/t
Stage 9: Galvanized / Coated Steel
| Product | Price (Rs/t) | Source |
|---|---|---|
| GPSP (Galv. Skin Pass) sheets | 60,000 - 76,500 | IndiaMART/supplier quotes, 2024-2025 |
Stage 10: Auto-grade / Specialty Steel
| Product | Price (Rs/t) | Period |
|---|---|---|
| Electrical steel (CRGO) — India | ~1,70,000 (USD 2,016/MT) | Q4 2025 |
| CRGO range globally | 1,26,000 - 12,60,000 ($1.50-$15.00/kg) | 2025 |
Auto-grade steel (high-strength, dual-phase, etc.) typically commands 20-50% premium over standard CRC, placing it in the Rs 75,000 - 95,000/t range.
2. THE VALUE MULTIPLIER
Using Raipur/Odisha-proximate prices (Mar 2026, excl. GST):
| Stage | Product | Rs/tonne | Multiplier vs Ore |
|---|---|---|---|
| 1 | Iron ore fines (62% Fe, ex-mine Odisha) | 5,000 | 1.0x |
| 2 | Iron ore concentrate | 3,650 (lower grade input) | — |
| 3 | Iron ore pellets (Fe 63%) | 9,700 - 10,000 | 2.0x |
| 4 | Sponge iron / DRI | 27,500 | 5.5x |
| 5 | Pig iron (steel grade) | 37,200 | 7.4x |
| 6 | Billets / crude steel | 40,800 | 8.2x |
| 7 | HRC (hot rolled coil) | 55,000 | 11.0x |
| 8 | CRC (cold rolled coil) | 63,000 | 12.6x |
| 9 | Galvanized steel | 70,000 | 14.0x |
| 10 | CRGO electrical steel | 1,70,000 | 34.0x |
The headline number: Rs 5,000 ore becomes Rs 55,000 HRC = 11x value multiplier.
If we use the NMDC Mar 2026 fines price (Rs 4,050/t) as the base:
- HRC at Rs 55,000 = 13.6x multiplier
- CRC at Rs 63,000 = 15.6x multiplier
Using lower-grade fines (55-58% Fe) at ~Rs 3,500/t:
- HRC at Rs 55,000 = 15.7x multiplier
3. KEY PROCESSING STAGES
Stage 1: Mining & Extraction
- Open-cast mining of iron ore (hematite in Odisha/Jharkhand)
- Crushing and screening to separate lumps (10-40mm) from fines (<10mm)
- India’s iron ore: primarily hematite, found in Odisha, Jharkhand, Chhattisgarh, Karnataka
Stage 2: Beneficiation
- Upgrading low-grade ore (below 58% Fe) to higher Fe content (62-64%)
- Processes: washing, jigging, magnetic separation, flotation
- Converts waste fines into usable concentrate
- Critical for Odisha where much ore is sub-58% Fe
Stage 3: Pelletization
- Concentrate ground to fine powder, mixed with binder (bentonite)
- Formed into 9-16mm spherical pellets
- Fired in induration furnace at 1,200-1,350 deg C
- Product: uniform-size, high-Fe pellets ideal for blast furnace or DRI
Stage 4a: Blast Furnace (BF-BOF route)
- Iron ore + coke + limestone charged into blast furnace
- Hot air blown in, coke burns, reduces ore to liquid iron (hot metal / pig iron)
- Pig iron tapped, sent to Basic Oxygen Furnace (BOF)
- BOF blows pure oxygen to convert pig iron to crude steel
- 43% of India’s steel made via BF-BOF
Stage 4b: Direct Reduction (DRI-EAF route)
- Iron ore (lumps or pellets) reduced using coal or natural gas in rotary kiln
- Produces sponge iron (DRI) — solid-state reduction, no melting
- DRI melted in Electric Arc Furnace (EAF) or Induction Furnace (IF)
- India is world’s largest DRI producer; 80%+ is coal-based
- Dominant route for smaller producers in Odisha, Chhattisgarh
Stage 5: Rolling — Hot Rolling
- Steel slabs/billets reheated to 1,100-1,250 deg C
- Passed through series of rollers to reduce thickness
- Produces HRC (Hot Rolled Coil), plates, bars, structural sections
- HRC thickness: typically 1.6-25mm
Stage 6: Rolling — Cold Rolling
- HRC further rolled at room temperature
- Produces thinner gauge (0.15-3.0mm), better surface finish
- Higher dimensional precision
- Used for auto body panels, appliances, packaging
Stage 7: Coating / Finishing
- Galvanizing (zinc coating), tin plating, colour coating
- Produces GP/GC, tinplate, colour-coated sheets
- Adds corrosion resistance and aesthetic value
4. RAW MATERIAL CONSUMPTION PER TONNE OF STEEL
| Input | Quantity per tonne of crude steel |
|---|---|
| Iron ore | ~1.7 tonnes |
| Coking coal (BF-BOF) | ~0.8 tonnes |
| Non-coking coal (DRI) | ~1.2 tonnes per tonne of sponge iron |
| Limestone/flux | ~0.3 tonnes |
Input costs for 1 tonne of crude steel (BF-BOF route, approx.):
- Iron ore: 1.7t x Rs 5,000/t = Rs 8,500
- Coking coal (imported): 0.8t x Rs 16,000-25,000/t ($190-300/t) = Rs 12,800-20,000
- Other inputs (limestone, ferro-alloys, energy, labour): Rs 8,000-12,000
- Total production cost: Rs 30,000-40,000/t crude steel
Input costs for DRI route:
- Iron ore: 1.5-1.7t x Rs 5,000/t = Rs 7,500-8,500
- Non-coking coal: 1.2t x Rs 9,400/t (SA RB2 grade) = Rs 11,280
- Power & other costs: Rs 5,000-8,000
- Total sponge iron production cost: Rs 22,000-27,000/t
5. ENERGY CONSUMPTION AT EACH STAGE
| Stage | Energy (GJ/tonne) | Notes |
|---|---|---|
| Beneficiation | 0.1 - 0.3 | Crushing, grinding, separation |
| Pelletization (hematite) | 1.4 - 1.7 | Induration/firing dominant |
| Pelletization (magnetite) | 0.6 - 0.8 | Exothermic oxidation reduces fuel need |
| Sintering | ~2.0 | 10% of total steel industry energy; 78% from coke breeze |
| BF ironmaking | ~12.0 - 14.0 | Largest energy consumer in value chain |
| BOF steelmaking | ~0.5 - 1.0 | Exothermic process; net energy producer with gas recovery |
| DRI (coal-based) | ~14.0 - 17.0 | Includes coal energy |
| EAF steelmaking | ~2.0 - 2.5 | Electricity: 664-825 kWh/t |
| Hot rolling | ~2.0 - 2.5 | Reheating furnace dominant |
| Cold rolling | ~1.0 - 1.5 | Lower temperature process |
Total energy intensity:
- BF-BOF route (global avg): ~24.2 GJ/t crude steel
- DRI-EAF route (global avg): ~23.1 GJ/t crude steel
- India-specific: 6.0-6.5 Gcal/t (~25-27 GJ/t) vs. global best of 4.5-5.0 Gcal/t (~19-21 GJ/t)
India’s higher energy intensity driven by: lower-grade domestic coal, smaller plant sizes, older technology in many units.
6. CAPEX (Capital Expenditure) AT EACH STAGE
Pellet Plant
- JSPL (Angul, Odisha): Rs 1,200-1,400 crore for 7 MTPA = Rs 170-200 crore per MTPA
- Essar (Paradeep, Odisha): Rs 6,000 crore for integrated complex (beneficiation + 6 MTPA pellet plant + 253km slurry pipeline) — pellet plant share approx. Rs 150-200 crore/MTPA
Sponge Iron / DRI Plant
- Coal-based (India): ~Rs 35 crore for 350 TPD (~127,000 TPA) = ~Rs 275 crore per MTPA (small scale)
- Gas-based DRI (global): ~$263.5/t capacity = ~Rs 2,200 crore per MTPA
- Hydrogen-based DRI: ~$685/t capacity = ~Rs 5,700 crore per MTPA
Integrated Steel Plant (Greenfield)
Based on recent Indian announcements:
- JSW (Gadchiroli, Maharashtra): Rs 1,00,000 crore / 25 MTPA = Rs 4,000 crore per MTPA
- JSW (Jagatsinghpur, Odisha): Rs 65,000 crore / 13.2 MTPA = Rs 4,924 crore per MTPA
- ArcelorMittal Nippon (Anakapalle, AP): Rs 1,50,000 crore / 24 MTPA = Rs 6,250 crore per MTPA
- Range: Rs 4,000 - 6,250 crore per MTPA for greenfield integrated
Hot Strip Mill (Rolling)
- Global average: US$ 187 per tonne of annual capacity (~Rs 15.6 crore per MTPA at Rs 84/$)
- Average total cost: US$ 506 million for ~2.93 MTPA capacity
Recent CAPEX Plans (FY2025-26)
- Tata Steel: Rs 15,000 crore capex (80% in India) — expansion + modernization
- SAIL: Rs 7,500 crore capex for FY26 (25% increase YoY)
- JSW Steel: Rs 47,457 crore over 3 years (announced 2021)
7. TAXES, ROYALTIES, AND STATUTORY LEVIES ON IRON ORE
| Levy | Rate | Basis |
|---|---|---|
| Royalty | 15% | Ad valorem (of average sale price) |
| DMF (District Mineral Foundation) | 30% of royalty | i.e., 4.5% of sale price |
| NMET (Nat’l Mineral Exploration Trust) | 2% of royalty | i.e., 0.3% of sale price |
| Total statutory burden | ~19.8% | Of average sale price |
For auctioned mines, the premium paid in auction is ADDITIONAL to the above.
Example: On ore priced at Rs 5,000/t, statutory levies = ~Rs 990/t.
8. COKING COAL PRICES (Key Input)
| Source | Price | Period |
|---|---|---|
| Imported (Australian, FOB) | $320-330/t | Q1 CY2024 |
| Imported (avg) | $197/t | Early 2025 |
| Landed cost India (approx.) | Rs 16,000-25,000/t | 2024-2025 range |
India imports ~85% of its coking coal requirement. Domestic coking coal is high-ash, requires washing.
9. KEY FINANCIAL METRICS — MAJOR PRODUCERS
NMDC (FY2024)
- Production: 45.02 MT iron ore
- Revenue: Rs 22,679 crore
- EBITDA: Rs 8,709 crore
- Implied realization: ~Rs 5,093/t
- Operating margin: 32.9% (down from 41.3% in FY23)
- Cost of production (implied): ~Rs 3,400/t (very rough estimate from margin data)
JSW Steel (FY2024)
- Operating profit: Rs 11,395/MT (up from Rs 8,284/MT in FY23)
- 37% captive iron ore supply (target: 50%)
India Steel Industry
- Installed crude steel capacity (Odisha): 45.5 MTPA in 2024-25 (up from 41.2 MTPA in 2023-24); ~23% of India’s total (Survey Ch. 5 §5.3.39); historical baseline 33 MTPA (2020-21); target 100 MTPA by 2030 (Survey Ch. 5 §5.3.38)
- Odisha steel production: 29.6 MTPA in 2024-25 (up from 27.3 MTPA in 2023-24) (Survey Ch. 5 §5.3.39)
- National per capita steel consumption: 86.7 kg (target: 160 kg by 2030-31)
- CO2 intensity: 2.54 tCO2/t crude steel (vs. global avg 1.91)
10. THE ODISHA STORY — VALUE LEAKAGE
What leaves Odisha as raw material:
- Iron ore fines at Rs 3,500-5,000/t
What it could become if processed in-state:
- Pellets at Rs 9,700/t (2x)
- Sponge iron at Rs 27,000/t (5-7x)
- Billets at Rs 40,000/t (8-10x)
- HRC at Rs 55,000/t (11-14x)
- CRC at Rs 63,000/t (13-16x)
- Auto-grade steel at Rs 80,000+/t (16-20x)
- CRGO electrical steel at Rs 1,70,000/t (34x+)
The 11x-to-14x gap from ore to HRC is the core economic argument for in-state processing.
Odisha produces 55% of India’s iron ore in 2024-25 (Survey Ch. 5 §5.3.36) — 178.99 million tonnes in absolute terms (Survey Ch. 5 §5.6.5). Much of it still leaves as raw ore or low-value fines.
SOURCES
NMDC Pricing
- NMDC Official Iron Ore Prices
- NMDC March 2026 price hike — WhalesBook
- NMDC Oct 2024 price hike — BigMint
- NMDC Nov 2025 prices — ScanX
- NMDC Oct 2025 prices — BusinessToday
Odisha Iron Ore
- CEIC — Odisha Fines 55-58% Fe
- CEIC — Odisha Fines 60-62% Fe
- CEIC — Iron Ore Concentrate
- BigMint — Odisha iron ore index
Pellets
Sponge Iron / DRI
- Sree Metaliks — Sponge Iron Pricing in Odisha
- BigMint — DRI production data
- Fastmarkets — DRI vs scrap
Pig Iron
Steel (HRC, CRC, Billets)
- OfBusiness — HRC Prices
- OfBusiness — CRC Prices
- Ayron Mart — HR/CR Coil Prices
- Ayron Mart — Sponge Iron & Pellet Prices
- Ayron Mart — Pig Iron Prices
- Ayron Mart — Ingot & Billet Prices
- CEIC — Mumbai Billets
CAPEX
- JSPL Pellet Plant — Business Standard
- Essar Pellet Complex — IBEF
- SteelOnTheNet — Hot Strip Mill CAPEX
- IBEF — India Steel Industry
Energy
- IRENA — Iron and Steel
- IntechOpen — Iron Ore Pelletizing Process
- World Steel — Energy Fact Sheet
- Global Energy Monitor — India Steel Brief
Royalty & Regulation
- CSEP — Mineral Royalty Rates
- Steel-360 — Royalty Compilation
- BigMint — NMDC prices include royalty/DMF/NMET
Value Chain Analysis
- Zerodha Varsity — Steel Part 1
- EY-FIMI — Coal, Iron Ore and Steel Report 2023
- NITI Aayog — Disruptive Innovation in Iron & Steel
- Odisha Steel & Mines Dept — Growth Potential
Electrical / Specialty Steel
Cited in
The narrative series that build on this research.