- Global fines spot prices, futures up $6-7/t w-o-w
- Pellet export prices expected to hit $100/t FOB
The Indian pellet export market witnessed a sharp upward movement this week, buoyed by improved global sentiment and a notable uptick in inquiries from overseas buyers. Notably, the rebound in global iron ore prices, particularly in China, has rekindled demand for Indian pellets.
Price update
BigMint’s India pellet (Fe 63%, 3-3.5% Al) export index (FOB east coast) rose by $6/tonne (t) w-o-w to $99.5/t on 23 July 2025 against 16 July. Notably, no pellet export deal was reported from India’s eastern coast this week.
The market is expecting prices to hit the much-sought-after figure of $100/t FOB in the next couple of days, which may further boost deal momentum.
An India-based pellet maker recently concluded an export deal for 50,000 t of material (Fe61%, Al2O3+SiO2: 11.5%) through a tender scheduled yesterday. The deal was closed at around $102.5-103/t FOB India, according to sources. The recent hike in global iron ore prices supported Indian pellet export offers.
Market participants revealed that the gap between bids and offers has significantly narrowed, allowing for better alignment and encouraging more realistic deal negotiations. Few deals are currently under discussion from ports along India’s eastern coast, indicating a gradual revival in export activity.
Market comments
As per sources, some deals could be finalised soon, supported by the hike in the international iron ore prices. A pellet producer added that inquiries from seaborne buyers increased as iron ore prices are currently hovering at $105/t CFR China. “We are negotiating some deals and may finalise them soon,” they noted.
Prices were supported by rising steel futures in China and decreased iron ore shipments from major miners. This led to lower arrivals at Chinese ports. Chinese steel mills witnessed a w-o-w increase in blast furnace capacity utilisation and hot metal production, which further raised iron ore prices.
However, market participants said that weak steel demand due to the off-season may moderate the upward momentum and lead to short-term price stabilisation.
The main driver of the market was the announcement of a large-scale hydropower project in Tibet worth RMB 1.2 trillion ($167 billion). There are plans to create a cascade of five hydroelectric power plants with a total capacity of 60 GW, which is three times the capacity of the Three Gorges Dam. The initiative has fuelled hopes for growth in long-term demand for steel in China, especially in the long-length rolled steel segment. As a result, trader activity in the futures market and the conclusion of real deals have increased.
Domestic vs export market gap
Domestic prices exceeded export offers by around INR 1,350/t ($16/t), with a rise in both domestic and export prices. Pellet (Fe63%) prices in Odisha’s Barbil were recorded at INR 7,900/t ($91/t) exw, rising INR 150/t ($2/t) w-o-w. Meanwhile, the ex-plant realisation in exports from Barbil was firm w-o-w at INR 6,550/t ($76/t) exw.
Rationale
- No confirmed deals from India’s east coast were recorded in this publishing window for T1 trade. Thus, this category was not taken into consideration for today’s price calculations and accorded 0% weightage in the index calculation. Click here for the detailed methodology.
- Thirteen (13) indicative prices were received, and twelve (12) were considered for the calculation of the index and given 100% weightage.
Factors impacting pellet exports
Chinese iron ore fines prices up w-o-w: The benchmark iron ore fines index rose $7/t w-o-w at $105/t CFR China on 22 July. Market sentiment was fuelled by optimistic macroeconomic signals, including news of a hydropower initiative, and there was active buying of mid-grade fines. China announced its intention to build the world’s largest hydropower dam, which may support the construction, cement, and steel sectors. The market was bullish, with portside prices rising on stimulus hope.
DCE iron ore futures climb up w-o-w: Iron ore futures on the Dalian Commodity Exchange (DCE) for the May 2025 contract improved by RMB 41.5/t ($6/t) w-o-w to RMB 814.5/t ($113/t) on 23 July.
Outlook
According to BigMint’s analysis, the coming weeks are expected to see active pellet export deals as market fundamentals remain supportive, and Chinese stimulus hopes continue to drive bullish sentiment in the raw materials segment.
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