- Over 80% of Brazil’s pig iron exports directed to US
- Brazilian prices up 19% since Jan’26 amid tariff uncertainty
The US decision to exempt Brazilian pig iron from the proposed 25% tariff has removed a major source of uncertainty for the global pig iron market. Earlier this month, the United States Trade Representative (USTR) proposed additional duties on Brazilian products under its Section 301 investigation, prompting concerns that Brazilian pig iron could lose competitiveness in its largest export market.
The announcement led market participants to anticipate a shift in global trade flows, with expectations that Brazil would divert cargoes to Europe while suppliers from India and Ukraine could gain a larger share of US demand. However, the exemption announced on 15 July preserved Brazil’s access to the US market, significantly reducing the likelihood of any immediate disruption to trade flows.
Export exposure
Brazil remains heavily dependent on the US for pig iron exports. In CY’25, the country exported 4.08 million tonnes (mnt) of pig iron globally, of which 3.42 mnt, that is 83%, were shipped to the US. During January-June 2026, exports totalled 1.92 mnt, including 1.50 mnt to the US, highlighting why the proposed tariff had raised significant concerns among exporters.
Price movements
Despite weeks of tariff uncertainty, Brazilian pig iron prices remained resilient. BigMint’s FOB Ponta da Madeira assessment averaged $498/t in July, unchanged from June after rising from $489/t in May. Since January 2026, prices have climbed nearly 19% from $417/t, supported by stronger second-quarter buying, limited spot availability, and producers withholding fresh offers while awaiting clarity on the US tariff decision. These factors helped prices remain elevated despite market uncertainty.
Prior to the exemption, market participants expected Brazilian exporters to redirect material to Europe, potentially weighing on European prices, while Indian and Ukrainian suppliers anticipated greater opportunities in the US. The exemption has significantly reduced those expectations, allowing Brazil to retain its dominant position in the US market.
Nevertheless, competition remains intense. Indian pig iron offers around $480/t CFR New Orleans are expected to cap Brazilian prices, with market participants indicating Brazilian cargoes may trade around $495-500/t CFR, equivalent to $460-470/t FOB over the current and coming month. Consequently, Brazilian pig iron prices are expected to ease from July highs as competition from India and seasonally weaker US steel demand weigh on buying interest.
Outlook
The tariff exemption is expected to keep Brazilian exports to the US largely unchanged over the near term, preserving established trade flows. However, Brazilian pig iron prices are likely to remain under downward pressure as competitive Indian offers, softer seasonal US steel demand and cautious buying limit upside. The market will also closely monitor the outcome of the ongoing Section 301 forced-labour investigation, which could further influence pricing and trade flows in the coming weeks.
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