India: Pellet export prices drop below $100/t FOB but low-alumina material in demand

• Buyers bid aggressively for low-alumina pellets
  
  
• Bulk domestic deals shift sellers from exports
  
  

BigMint's India pellet (Fe 63%, 3-3.5% Al) export index inched down by $1.5/t w-o-w at $98.5/t FOB east coast on 24 June 2026. Pellet export prices in the seaborne market remained under pressure during the assessment period as trading activity stayed subdued across India's east coast. Market participants attributed the muted sentiment to weak demand for normal-grade pellets in the overseas market, particularly from key Asian destinations.

According to market sources, a pellet producer concluded a 120,000 t deal for Fe 64%, 1.5% Alumina grade pellets from Vizag at around $122-124/t CFR China in last two weeks.

Another pellet producer concluded around 50,000 t pellet (Fe 63%, 1.5% Alumina) export deal at 107-108/t FOB last week further supported the pellet export market.

Recently a tender was floated by a Southern India-based player for high-grade low alumina pellet (Fe 66%, Al2O3: 1.2%, SiO2: 2.3%), which remained unsold due to lower bids from buyers.

Chinese pellet inventories across 34 major ports stood at around 6.57 mnt this week, dropped 0.21 mnt compared to the previous week.

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.
  
  
• Nine (9) indicative prices were received, and seven (7) were considered for the calculation of the index and given a balance 100% weightage.
  
  

Market updates

Despite the sluggish trading environment, a few low-alumina pellet shipments were concluded by central and south Indian producers toward the end of last week. Buyers continued to show interest in premium-grade low-alumina pellets, which maintained relatively stronger demand compared to standard-grade material.

An international trader said, "Chinese buyers continue to prefer low-alumina pellets which has supported prices for premium-grade material despite the broader market weakness."

However, the continued decline in international iron ore fines prices has impacted overall pellet demand, particularly for east coast-origin pellets. Market sources reported that buyer indications were heard around $110/t CFR China, while suppliers remained reluctant to accept these levels, offering material at approximately $117-118/t CFR China. The significant gap between buyer bids and seller expectations restricted fresh deal activity during the week.

Another market participant commented, "Strong domestic demand has diverted sellers' attention away from export markets. Several bulk pellet transactions were concluded in key domestic markets such as Raipur and Odisha during the previous week, providing producers with alternative sales opportunities."

A pellet producer informed, "Domestic realisations are currently more attractive than export parity levels. As a result, many producers are prioritizing domestic sales rather than aggressively pursuing export orders."

Export margins remain under pressure due to lower international prices and elevated logistics costs. Consequently, exporters have adopted a cautious approach toward fresh bookings.

Domestic vs export market

The price gap between export and domestic realisations was recorded at INR 450/t this week, improved w-o-w. Export realisations (Fe 63%) were at INR 7,150/t ($76/t) this week while domestic realisations (Fe 62.5%) reduced by INR 50/t ($0.5/t) w-o-w to INR 7,600/t ($80/t) exw.

Factors impacting pellet exports

Chinese iron ore fines prices down w-o-w: The benchmark iron ore fines Fe 61% index dropped by $4/t w-o-w to $97/dmt CFR China on 23 June. Iron ore prices continued to soften despite Chinese market participants returning after the Dragon Boat Festival (19-21 June 2026). Trading activity remained thin, with limited transactions reported for mainstream iron ore brands, particularly blend fines.

DCE iron ore futures edge down w-o-w: Iron ore futures on the Dalian Commodity Exchange (DCE) for the September 2026 contract settled at RMB 743/t ($109/t) on 24 June, weakening RMB 16.5/t ($/2) w-o-w.

Outlook

BigMint expects pellet export prices to remain weak in the near term. Continuous softness in seaborne iron ore fines prices and limited buying interest from overseas consumers may keep pellet export prices under pressure, while domestic demand trends will continue to influence producers' sales strategies.