- Export trade muted as domestic realisations remain INR 1,000/t higher
- Chinese demand remains selective, wide bid-offer gaps restrict trade
BigMint’s India pellet (Fe 63%, 3-3.5% Al2O3) export index increased by around $2/t w-o-w to $101/t FOB east coast in the week ending 26 August 2026, reaching its highest level in around a month, last seen on 29 July.
The rise followed a modest recovery in the Fe 61% iron ore fines benchmark, which supported pellet offers. However, weak export economics continued to limit fresh bookings, preventing a stronger increase.
Domestic sales and captive consumption remained more attractive for several producers, limiting their interest in fresh export business. Meanwhile, Chinese buying interest remained selective, while the bid-offer gap continued to restrict fresh trade.
As a result, the modest increase in the export index primarily reflected firmer underlying iron ore prices and limited seller participation rather than a significant revival in physical demand.
Rationale
- Zero (0) confirmed T1 deals from India’s east coast were recorded during the publishing window. Accordingly, this category was assigned a 0% weightage in today’s price calculation. Click here for the detailed methodology.
- Nine (9) bids, offers and indicative prices were heard, of which seven (7) were considered for index calculation and assigned the remaining 100% weightage.
Market updates
Export activity remained muted during the week as Indian producers continued to find domestic sales more profitable than overseas business. The higher domestic realisation limited the willingness of suppliers to reduce offers, while buyers remained cautious and unwilling to materially improve bids.
The export market also saw limited spot availability as producers focused on fulfilling pre-booked domestic and export orders. This, coupled with selective Chinese demand, kept trading activity thin despite the improvement in underlying price sentiment.
The current pricing structure continues to favour domestic sales, while the improvement in India’s export index has yet to translate into stronger booking activity.
Domestic vs export market
Export realisation for Fe 63% pellets increased by INR 200-250/t ($2-3/t) w-o-w to INR 7,500-7,550/t ($79-80/t). Meanwhile, the domestic realisation for Fe 62.5% pellets stood at around INR 8,800/t ($92/t) exw, leading to a domestic premium of INR 1,200-1,250/t ($13-13.5/t).
The gap remains commercially unviable for most sellers, reinforcing the preference for domestic sales over fresh export bookings.
Why are pellet export prices firm despite muted bookings?
- Chinese iron ore benchmark edges up w-o-w amid selective restocking: The benchmark iron ore fines (Fe 61%) index edged up by around $1/dmt w-o-w to $97/dmt CFR China on 25 August, supported by selective restocking and improved buying interest at lower price levels. However, overall sentiment remained cautious as mills continued to face margin pressure and avoided aggressive purchases. Ample availability of lower-alumina material also capped demand for medium-grade cargoes, limiting the pace of the recovery. The market may remain sensitive to changes in steel margins and restocking activity in the coming week.
- DCE iron ore futures rise as selective restocking supports sentiment: Iron ore futures on the Dalian Commodity Exchange (DCE) for the January 2027 contract settled at RMB 720/t ($107/t/t) on 26 August, up by RMB 12/t ($1.8/t) d-o-d from RMB 708/t ($105.4/t). The increase reflected improved market sentiment amid selective restocking by Chinese mills and firmer seaborne iron ore prices. However, gains may remain limited as mills continue to purchase cautiously amid pressure on steel margins and uncertainty over downstream demand.
India’s pellet export shipments nearly double w-o-w
India’s pellet export shipments increased nearly two-fold w-o-w to 0.31 million tonnes (mnt) (313,100 t) in Week 34 (15-21 August 2026), compared with 0.16 mnt (159,620 t) in the previous week as per the vessel line-up data maintained by BigMint. The increase was driven by higher shipments from Mangalore (109,600 t), Dhamra (75,000 t), Kandla (73,500 t), and Paradip (55,000 t). Note, deal was happened earlier a month ago, figure showing is getting shipped for destination.
Outlook
India’s pellet export market may remain subdued in the coming week as domestic realisations continue to offer significantly better returns than exports. Limited Chinese buying and a persistent bid-offer gap may also restrict fresh bookings, even if seaborne iron ore prices remain firm.
A further improvement in international pellet prices would be needed to narrow the domestic-export realisation gap and encourage producers to return to the spot export market. Until then, most suppliers are likely to prioritise domestic sales and focus on executing previously booked orders.
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