India: Jindal SAW reduces iron ore pellet offers by INR 300/t ($3/t) in Kandla

• Weak sponge iron demand drags Kandla offers lower
• Steel prices fall, price gap between pellets, lumps shrinks

Jindal SAW recently reduced its iron ore pellet offers (Fe 63+/-0.5%) for the Kandla market by INR 300/t ($3) m-o-m to INR 11,300/t DAP, primarily due to subdued demand from sponge iron producers and easing raw material costs, along with a weaker global iron ore market.

Market participants stated that muted finished steel demand continued to weigh on sponge iron margins, resulting in cautious procurement of pellets. Additionally, adequate inventories at ports and among traders limited the need for aggressive buying, keeping market sentiment soft. The company last revised its offer to INR 11,600/t on 22 June 2026.

Key factors driving decline

• Billet prices decline m-o-m: Ahmedabad’s billet prices declined by INR 1,700/t m-o-m to INR 40,800/t in July, reflecting a prolonged softness in the market. However, prices stood at INR 41,500/t today, gaining INR 500/t d-o-d. Weak finished steel demand and lower buying appetite from secondary steelmakers reduced pellet consumption.
• South African lumps prices dip m-o-m: Prices of South African lumps CNF Kandla stood at $115/t, edging down by $1/t against June 2026 prices. A narrower price gap between lumps and pellets has exerted downward pressure on pellet prices.
• Global iron ore (Fe 61%) prices decline: The benchmark index for iron ore fines (Fe 61%) declined by $4/dmt m-o-m to $94/dmt CFR North China as of 3 August. The market was sluggish, with mills refraining from fresh bulk purchases. Moreover, further expectations of softness in prices kept sentiment subdued.
• Jabalpur’s concentrate prices decline m-o-m: Concentrate prices in Jabalpur declined m-o-m by INR 350/t to INR 4,500/t in July, reducing feedstock costs for pellet manufacturers and supporting lower pellet offers. Moreover, some bulk deals at lower costs dragged prices down.

Outlook

BigMint expects pellet prices to remain under pressure in the near term unless sponge iron demand improves significantly or iron ore prices rebound. Buying activity is likely to remain need-based, with consumers closely tracking finished steel demand and raw material price movements before making fresh procurement decisions. However, limited inflows of material from neighbouring markets due to expected plant shutdowns could limit further corrections in prices.

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