India: Pellet export index falls by $3/t w-o-w as Chinese buying weakens

• Firm offers floated by suppliers but bid-offer gap persists 
• Buyers cautious about fresh deals, on wait-and-watch mode

Pellet export prices in the Indian seaborne market have fallen by $2-3/t over the past few days, pressured by weak buying interest from Chinese mills and deteriorating market sentiment. The downtrend has created cautious trading behaviour on both sides, with limited firm bids emerging from China.

Price update

BigMint’s India pellet (Fe 63%, 3-3.5% Al) export index decreased by $3/tonne (t) w-o-w to $102.5/t FOB east coast on 10 December. Pellet demand was weak in the seaborne market amid the lack of buying interest from Chinese mills.

No deal for Fe 63% pellets was recorded from the Odisha region in this publishing window, however; few supplier offered their fresh cargo in the sea market which may likely to be concluded in the near term.

Market movements

Market sources highlighted that Chinese mills are actively exploring alternative raw material options, reducing reliance on imported pellets. An exporter said, “The demand from China is not firm at the moment, and mills prefer cheaper or more flexible alternatives. With seaborne trading sentiment dull, international traders have adopted a wait-and-watch approach.”

Exporters also pointed out that Indian producers’ offers remain higher than what global traders find workable. An international trader noted, “There is almost a $5/t gap in bid–offer levels. Buyers are placing conservative bids, while sellers are reluctant to reduce offers sharply.” This mismatch has slowed transaction activity in the spot market.

Only a few Indian suppliers are currently active in the export segment. “Two or three suppliers are regularly offering cargoes in the sea market; others remain committed to domestic orders due to better realisations,” another exporter mentioned.

Some producers, however, have begun offering their cargo in anticipation of short-term deals. “We expect deals to conclude soon as multiple shipments have been floated,” a producer said.

On the other hand, a supplier reported receiving counter-offers from buyers. He added “We have started adjusting our offers slightly to match the fresh trade signals from the market.”

Despite the export pressure, domestic suppliers continue to focus on local buyers, driven by comparatively stronger margins in the Indian market.

Domestic vs export market gap shrinks

Domestic prices exceeded export offers by around INR 1,050/t ($12/t), with the gap widening by INR 400/t w-o-w. Pellet (Fe63%) prices in Odisha’s Barbil were recorded at INR 8,250/t ($92/t) exw, fell INR 100/t to last weekend. Meanwhile, the ex-plant realisation in exports from Barbil fell by INR 300/t ($3.5/t) w-o-w to INR 7,200/t ($80/t) exw.

Rationale

• No (0) confirmed deals from India’s east coast were recorded in this publishing window for T1 trade. Thus, this category was allotted zero % weightage for today’s price calculations. Click here for the detailed methodology.
• Twelve (12) indicative prices were received, and Eleven (11) were considered for the calculation of the index and given the balance 100% weightage.

Factors impacting pellet exports

• Chinese iron ore fines prices drop w-o-w: The benchmark iron ore fines index fell $2/t w-o-w to $106/t CFR China on 9 December. The market experienced new trading activity, primarily focused on medium-grade fines, amid a weak outlook. The earlier optimism regarding macroeconomic support in December has declined, leading to a bleak view of market fundamentals for the near term. Mills are likely to prioritise cost-effectiveness in their procurement decisions in the short term.
• DCE iron ore futures decline w-o-w: Iron ore futures on the Dalian Commodity Exchange (DCE) for the January 2026 contract closed at RMB 758.5/t ($107/t) on 10 December, declining by RMB 41/t ($5/t) w-o-w.

Pellet inventories at major Chinese ports stood at 2.78 mnt on 4 December, inching up by 0.13 mnt w-o-w as per data published by SteelHome.

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