There's a chance it clipped under the altar or any boulder there.
I don't know if you have auto-pickup activated or not; but that feature makes it possible to "pick up" items even if they're hidden in a rock or something.

Might worth a try to activate that one first (v-key), do another walk along the area you killed the Elder and if that doesn't work, try to dig down a bit to see if it's hidden under something.
Keep doing that with the auto pickup activated and you will most likely get that key.

Thorin :)