India: Pig iron prices ease in Apr26 after early surge, exports lend support to prices

• Early-April prices hit two-year high
  
  
• Export-led tightness supports market
  
  

Indias pig iron market started April 2026 on a firm note, with prices climbing to around INR 41,300/t in early April, the highest level in nearly two years. The uptrend was driven by elevated raw material costs, export-led supply tightness and geopolitical risk premium.

However, the rally lost momentum in the second half. Following the ceasefire announcement and improvement in domestic availability, prices gradually corrected to around INR 38,800/t by month-end, down nearly INR 1,900/t or 4.6% from the peak. Election-related disruptions in eastern India, particularly West Bengal, also affected trade flows and slowed material movement across key producing and consuming centres.

Raw material costs remain supported

Input costs remained broadly firm during April, limiting the extent of downside correction. Merchant met coke prices increased by around INR 400/t m-o-m to INR 36,400/t, continuing to support pig iron production costs. In contrast, Australian coking coal prices softened to around $253/t from $261/t in March, offering partial cost relief. Market participants noted that the benefit of lower coal prices was largely offset by firm domestic coke prices, keeping producer margins under pressure. Toward month-end, marginal improvement in buying activity allowed producers to partially pass through elevated costs.

Auction benchmarks indicate resilient demand

Auction activity remained steady through April, with around 8-10 auctions conducted by key producers. Early-month auctions concluded with full bookings near INR 38,000-38,350/t, reflecting stable underlying demand despite cautious spot buying. Realisations improved gradually during the month, with late-April auctions touching around INR 40,100/t. The rise in auction prices despite selective spot market participation suggests that institutional buyers continued to retain confidence in near-term market fundamentals.

Substitute metallics cap upside

Pig iron faced competitive pressure from softer substitute metallics during April. Sponge iron prices in Durgapur declined by around INR 1,100/t m-o-m, while domestic scrap prices eased by nearly INR 600/t. The correction narrowed pig irons relative cost advantage and influenced procurement strategies among secondary steelmakers. However, domestic scrap availability remained limited, which restricted aggressive substitution and prevented a sharper decline in pig iron consumption.

Exports support early-month tightness

Export activity remained a key support factor during April, particularly in the first half of the month. A prominent eastern-region producer concluded a steel-grade pig iron cargo of around 65,000 t to Trkiye, while another major western-region supplier booked nearly 55,000 t to the US. Additional export enquiries were also heard from Southeast Asian markets. Export realisations were largely in the range of $415-430/t FOB, which tightened domestic spot availability across key eastern markets and supported the early-April price uptrend. However, as these cargoes moved toward execution later in the month, domestic availability improved gradually, contributing to softer spot sentiment in the second half.

Q1 2026 closes stronger

The January-March quarter remained favourable for pig iron producers. Prices rose from around INR 36,000/t in January to nearly INR 40,000/t by end-March, up around INR 4,000/t or 11% q-o-q. Strong export demand, elevated met coke and coking coal costs, and tight substitute availability supported the uptrend. Stable production and firm domestic iron ore prices also kept cost pressure elevated, maintaining a supportive floor for producer offers.

Regional market trends

• Eastern India recorded the sharpest correction during April, with prices declining around 6% m-o-m from INR 41,300/t to INR 38,800/t as export-led tightness eased and domestic availability improved.
  
  
• Central India remained relatively stable. Raipur prices rose modestly to around INR 39,750/t, supported by tight supply in early April. However, improved scrap availability and fresh inflows from eastern India capped further upside.
  
  
• Northern markets corrected moderately. Steel-grade pig iron in Ludhiana eased from around INR 42,800/t to INR 42,300/t, while foundry-grade prices declined more sharply. Demand remained moderate, with buyers largely following need-based procurement.
  
  
• Western India remained firm on supply-side constraints. Foundry-grade prices rose to INR 45,000-46,500/t as elevated fuel costs reduced production by nearly 50%. Demand remained subdued, but tight availability supported higher offers.
  
  
• Southern India stayed relatively firm, with Coimbatore prices assessed near INR 46,000/t DAP. The market retained a premium on steady foundry demand and higher landed costs, although buying turned selective in the second half.
  
  

Outlook

The pig iron market is expected to remain range-bound in May with a mild corrective bias. With most export commitments concluded in April, domestic availability is likely to improve further. Demand from downstream segments is expected to remain moderate, with buyers continuing need-based procurement. Raw material prices are likely to remain broadly stable, though policy developments around met coke imports may keep cost dynamics under watch. At current levels, downside appears limited as elevated input costs and infrastructure-linked demand continue to provide support.