Mining and Quarrying Output PPI at 119.4: Mining-Cost, Royalty and Customer-Price Sensitivity
By Ravi Sisodia · Reviewed by CA Divyanshu Sengar · Updated 5 October 2026
2-minute summary
- Mining and Quarrying Output PPI was 119.4 in July 2026, down from 121.5 in June.
- Mining Output PPI should be kept distinct from royalty, auction premium, statutory levy and grade-adjusted realised price.
- The July index declined from June, which is a pricing signal but not proof that a particular mine earned less per tonne.
Current position
Mining and quarrying Output PPI aggregates different mineral activities. A mine model should therefore connect the relevant producer-price series to grade and customer formulas while leaving statutory charges in separate legal lines.
Control and evidence map
| # | Control / evidence requirement | |
|---|---|---|
| 1 | The output-price index is not a royalty rate. Mining models should keep selling-price benchmarks, statutory royalty/levies, grade, freight and contract deductions in separate lines. | |
| 2 | Reconcile benchmark price, grade adjustment and customer discount to realised revenue. | |
| 3 | Keep royalty and other statutory levies sourced from the applicable mining law or lease. | |
| 4 | Stress-test freight and evacuation costs independently of the output index. | |
| 5 | Document whether long-term offtake prices reset monthly, quarterly or by another formula. | |
Worked example
A miner can stress-test EBITDA for a 2-point output-index move while holding royalty assumptions constant unless the relevant law or lease formula actually links them.
Common mistakes
- Do not infer statutory royalty changes from PPI.
- Grade and location can dominate realised price.
- Keep tax/cess scenarios separate from producer price indices.
Frequently asked questions
Did royalty fall because PPI fell?
Not necessarily; royalty is governed by the applicable legal/contractual mechanism.
What changed from June to July?
The aggregated mining and quarrying Output PPI moved from 121.5 to 119.4.
Can the index predict mine EBITDA?
Only as one input among grade, volume, levies, freight and contract pricing.
Why keep legal levies separate?
They may change for reasons unrelated to producer prices.
Official sources
- Press Information Bureau / Department for Promotion of Industry and Internal Trade - Provisional WPI, Output PPI and Experimental Input PPI for July 2026; final May 2026 indices (PIB PRID 2299432; 2026-08-14)
- Press Information Bureau / Department for Promotion of Industry and Internal Trade - Provisional Wholesale Price Index for August 2026 (PIB PRID 2309977; 2026-09-14)
Disclaimer
Educational and professional reference only; confirm the current law, rates and the facts of your case before relying on this page.