- Pellet export deals under negotiation from east coast region
- Higher lump premium keep pellet demand higher in sea market
Pellet prices in the seaborne market increased by $2-3/t this week, supported by recently concluded export deals for higher-grade material and several ongoing negotiations in the market. Market participants noted that export inquiries have emerged in recent days, particularly as Chinese steel mills face tightening margins and higher lump premiums, which is driving interest in pellet cargoes.
Price and trades update
BigMint’s India pellet (Fe 63%, 3-3.5% Al) export index increased by $2/tonne (t) w-o-w to $99.5/t FOB east coast on 11 March. No pellet export deals were recorded recently for exports from east coast in this publishing window. However, a deals was heard at $115/t CFR China but yet to be confirmed by transected parties.
A pellet export (Fe 65%, 6% Alumina+ Silica) tender of 50,000 t was scheduled yesterday by an Indian pellet producer which was concluded at $114-115/t FOB India.
Market updates
According to an international trader, rising vessel freight rates have become a key factor affecting pellet producers’ margins. Freight costs have surged significantly following the increase in crude oil prices amid the ongoing geopolitical tensions in the Middle East. As a result, higher freight expenses are reducing the FOB realization for Indian pellet producers, limiting their profitability in export transactions.
Market sources indicated that despite freight pressures, demand for Indian pellet cargoes remains visible in the seaborne market. International trading houses are actively placing bids for April delivery shipments, signaling continued interest in Indian-origin pellets.
Meanwhile, the domestic pellet market has also witnessed a sharp price increase in recent weeks. A participant mentioned, “Several cargoes of low-alumina pellets have reportedly been sold in the domestic market, offering comparatively better margins for producers.”
A few pellet sellers on the east coast are currently prioritizing captive consumption or domestic sales, as domestic realizations are more attractive than export parity levels. However, market participants expect additional export shipments to be finalized soon, as multiple deals are currently under negotiation.
One pellet producer has also floated a low-alumina pellet export tender, which is likely to conclude within the next few days.
Market participants believe pellet export prices are likely to remain firm in the near term, supported by ongoing negotiations, stable demand in the seaborne market, and continued geopolitical uncertainty influencing freight dynamics.
Domestic vs export market
Domestic prices exceeded export realizations by around INR 1,450/t ($16/t), with the gap slightly narrowing w-o-w. Pellet (Fe 62.5%) prices in Odisha’s Barbil were recorded at INR 8,750/t ($97/t) exw, up INR 100/t w-o-w. Meanwhile, the ex-plant realization in exports from Barbil rose by INR 200/t w-o-w to INR 7,300/t ($76/t) exw.
Rational
- No confirmed deal from India’s east coast was recorded in this publishing window for T1 trade and was allotted 0% weightage for today’s price calculations. Click here for the detailed methodology.
- Ten (10) indicative prices were received, and seven (7) were considered for the calculation of the index and given a balance 100% weightage.
Factors impacting pellet exports
Chinese iron ore fines prices rise w-o-w: The benchmark iron ore fines Fe 61% index surged by $5/dmt w-o-w to $105/dmt CFR China on 10 March. Prices were supported by firmer end-user demand and improved macro sentiment, the market opened the week on a positive note. Positive cues from the two Sessions and firm energy prices supported sentiment, while expectations of stronger demand before the peak construction season kept trading activity steady.
DCE iron ore futures price: Iron ore futures on the Dalian Commodity Exchange (DCE) for the May 2026 contract closed at RMB 785/t ($107/t) on 11 March, increased RMB 5/t d-o-d.
Outlook
The pellet export market is expected to remain firm in near term with few deals may concluded which is currently under negotiation.
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