India: BigMint pellet export index drops to over three-month low

• Seasonal slowdown in China limited aggressive pellet buying
  
  
• Rising coking coal prices squeezed steel mill margins
  
  

BigMint's India pellet (Fe 63%, 3-3.5% Al) export index slipped by $1.5/t w-o-w to $97.5/t FOB east coast on 1 July 2026, with pellet prices continuing to stay under pressure amid weakness in the seaborne iron ore market. Index has fallen to lowest level since early Mar'26, as per data maintained with BigMint.

The overall market tone remained soft during the assessment period, largely in line with the weaker global iron ore fines market. At the same time, the seasonal slowdown in China's construction activity kept aggressive buying interest in check, especially for regular-grade pellets.

According to market sources, a producer reportedly concluded a deal for around 60,000 t of Fe 64%, 1.5% Al2O3 pellets at close to $123/t CFR China during the past week.

Another cargo offered by southern India pellet maker of regular-grade pellets (Fe 63%, 1.5% Al2O3) was heard booked at around $107-108/t FOB India yesterday.

Rationale

• Zero (0) confirmed deals from India's east coast was recorded in this publishing window for T1 trade, and, therefore, this category was allotted 0% weightage for today's price calculations. Click here for the detailed methodology.
  
  
• Eleven (11) indicative prices were received, and nine (9) were considered for the calculation of the index and given a balance 100% weightage.
  
  

Market updates

The current market largely remains downtrend, but some transactions continued for premium low-alumina material amid better cost-effectiveness by the Chinese mills.

An international trader commented, "Chinese buyers are still showing preference for low-alumina pellets, but bids for regular-grade material remain under pressure due to the softer fines market."

According to market sources, buyers were mostly indicating workable levels at around $108-110/t CFR China, whereas sellers were still offering cargoes closer to $117-118/t CFR China. The widening gap between buyer expectations and seller offers kept fresh deal activity limited.

Another market participant said, "The spread between buyer bids and seller offers has widened over the last few days, making it difficult to conclude fresh bulk deals."

Chinese pellet inventories across 34 major ports declined to around 6.36 mnt this week against however, market participants noted that pellet inventories have gradually normalised alongside iron ore fines and lump stocks.

A hong-Kong based trader source noted, "Steel mill margins have narrowed because of higher coking coal prices, so mills are becoming more aggressive on raw material cost optimisation."

Meanwhile, stronger domestic realizations continued to divert some sellers away from the export market. Several bulk pellet transactions were heard concluded in domestic markets such as central and eastern-India, over the past week.

A pellet producer informed, "Domestic realizations are currently better than export parity levels, so many sellers are prioritising local markets over aggressive export bookings." A few bulk deals have been finalised recently by giant steel producer, further keeping the sales pressure away and liquidity on higher end.

A few more bulk deals are expected in domestic market which may mute the trade activity in Indian ocean from the eastern-coast.

Domestic vs export market

The price gap between export and domestic realisations was recorded at INR 450/t this week, stable w-o-w. Export realisations (Fe 63%) were at INR 7,100/t ($75/t) this week while domestic realisations (Fe 62.5%) reduced by INR 50/t ($0.5/t) w-o-w to INR 7,550/t ($79/t) exw.

Factors impacting pellet exports

Chinese iron ore fines prices gain w-o-w: The benchmark iron ore fines Fe 61% index rose by $2/t w-o-w to $99/dmt CFR China on 30 June. Market sentiment improved as iron ore prices staged a technical rebound after a prolonged period of decline. With prices falling to their lowest levels in nearly a year, buyers stepped in to take advantage of lower levels, lending support to the market. Trading activity in the seaborne fines market remained limited, but discussions in the market helped lift confidence in both the physical spot and futures segments.

DCE iron ore futures remained rangebound w-o-w: Iron ore futures on the Dalian Commodity Exchange (DCE) for the September 2026 contract settled at RMB 743.5/t ($109/t) on 1 July, stable w-o-w.