India is weighing the imposition of an export duty on iron ore as early as October 2. The move comes amidst the government’s stern warning to industry that if domestic production fails to pick up and prices are “not halved,” then there will be a duty imposition, which can possibly extend to a blanket ban on exports, according to people familiar with developments of a high-level review meeting.The move would mark the government’s strongest intervention yet.businessline has reviewed the minutes of the meeting; and spoken to multiple participants present across ministries, industry bodies and steel makers.An export duty is already being considered on low-grade iron ore (with Fe content of 58 per cent or below) in 10-20 per cent range, which has put some industry bodies in a tizzy, sources said.Despite an environmental clearance (EC) capacity of over 200 million tonne a year, actual output has been stuck at barely half that level, raising alarm as India pushes to expand steel-making capacity.Ore ProductionThe FY25 iron ore production in India was around 290 million tonne (mt). Approximately 1.65 tonne of iron ore is required for making one tonne of crude steel. So for FY25, crude steel production was around 153 mt. Or around 253 mt of the mineral was used. Around 24 mt was exported. This meant there was around 13-14 mt of excess stock.However, exports were close to 30 mt in FY25 (Lower than FY24 levels).“If iron ore production is not increased and export-related issues are not resolved, then the export duty on iron ore will be imposed as soon as 2nd October 2025,” the minutes of the meeting noted, attributing the remark to one of the lawmakers’ who chaired the session.Other points raised by the minister include reducing domestic iron ore prices “to half the current levels” and “increasing steel exports to 50 mt.”Apparently, steel makers have referred to iron ore prices as being a reason for their offerings being non-competitive against Chinese players, in global markets.India steel exports hovered around the 5 mt mark in FY25; and the country was a net importer of the alloy.According to a meeting participant, the Minister told attendees that if conditions were not met, “there could be a ban on exports.”“The clear directions (from the minister) were to enhance iron ore production in the coming months,” the participant added.Act FastAt the meeting, the minister asked iron ore miners, including PSUs and states to act fast.Odisha, the country’s largest ore-bearing State, came under scrutiny for restrictive policies and inefficient clearances.State-run miners such as SAIL, NMDC and OMC were told to surrender unworked leases. For instance, NMDC has been unable to raise output, it was mentioned in the meeting. “…advised NMDC to surrender the unused mines so that they can be put back into auctions for new bidders,” a draft of the minutes noted.Mine PositionsAs per official data, there are 179 captive working mines of which 31 are held by PSUs and 148 by private players.Out of the total EC capacity of 203.11 MTPA, actual working capacity is just 116.55 MTPA, reflecting a 57 per cent shortfall.Of the 27 auctioned ECs amounting to 272.69 MTPA, only 114.89 MTPA has come into production.Pricing ResetThe government is also moving to reset the pricing framework.The Indian Bureau of Mines (IBM) has been directed to fix average sale prices (ASP) for all iron-ore grades within four weeks, while slimes pricing is expected in the next few days.For future auctions, premiums may be capped and bids restricted to upfront payments to bring predictability.Industry ConcernsIndustry groups, particularly steel-makers, flagged how high premiums from auctions are discouraging miners.Concerns were also raised about beneficiation plants lying idle for lack of feed, and exports of high-grade ore being disguised as low-grade through blending.Industry associations have already petitioned the government against imposing an export duty.Against Export DutyThe Federation of Indian Mineral Industries (FIMI) has written to the Union Commerce Minister, Piyush Goyal, reasoning that stockpiling and unused fines are creating environmental hazards, and urged the government to allow exports for “effective utilisation and monetisation of low-grade iron ore and enhanced availability… and that no export duty be imposed.”Separately, the Goa Mineral Ore Exporters’ Association, in a letter to PK Mishra, Principal Secretary to the Prime Minister, said most Goan ores are unsuitable for domestic steel-making, as higher-grade ores from the East and Bellary are “readily available and more cost-efficient.”“Goa can only contribute less than 5 per cent of India’s current iron ore production,” the letter noted, adding that Goa and the Konkan region should be exempted from any export duty, with the current nil-duty regime retained.Published on September 14, 2025