- India’s exports surge as tariff uncertainty limits US bookings of Brazilian material
- Competitive pricing lifts US demand for Indian cargoes despite longer transit time
- Rising crude steel output in US, attractive export pricing may support Indian exports
Morning Brief: India’s pig iron exports are gathering momentum after several years of subdued shipments, driven by growing demand from the US, tariff-related uncertainty around Brazilian supply, and competitive pricing.
India’s pig iron exports more than doubled to 0.60 million tonnes (mnt) in CY’25 from 0.26 mnt a year earlier, while shipments reached 0.40 mnt during January-May 2026, already equivalent to two-third of last year’s total.
The recovery has coincided with rising US crude steel production, which increased 6.3% y-o-y in H1CY’26, lifting demand for imported pig iron used by electric arc furnace (EAF) steelmakers. At the same time, uncertainty over proposed US tariffs on Brazilian pig iron encouraged some buyers to diversify procurement towards Indian cargoes, which were competitively priced.
Although the US has since imposed broader tariffs on Brazil and India, pig iron has been exempted for both after domestic steelmakers argued that limited merchant supply made imports indispensable. The decision removes a potential cost disadvantage for Brazil but has raised concerns if India’s robust export momentum will continue. BigMint analyses the implications.
Rising crude steel production lifts US pig iron demand
US pig iron imports increased to 5.30 mnt in CY’25 from 4.70 mnt a year earlier, broadly tracking a 3% rise in domestic crude steel production. Import demand has remained firm in CY’26, supported by higher steel output, expanding electric arc furnace (EAF) capacity, and continued reliance on imported virgin iron units.
EAFs account for more than 70% of US crude steel production, but domestic merchant pig iron availability remains limited, as most production is consumed by integrated steelmakers. As a result, EAF mills continue to rely on imported pig iron to supplement prime scrap supply. Although obsolete scrap availability has improved, supplies of prime scrap remain relatively tight, supporting pig iron demand by encouraging mills to blend imported pig iron with scrap to achieve the required steel chemistry.
These factors have increased the strategic importance of the US market for global pig iron exporters. Following the loss of Russian supplies after sanctions were imposed in 2022, Brazil has consolidated its position as the leading supplier. In CY’25, the US imported 3.3 mnt of pig iron from Brazil, accounting for 62% of total imports, followed by 1.4 mnt (26%) from Ukraine and 0.22 mnt (4%) from India.
Brazil’s dominance reflects its freight advantages into the US Gulf, competitive production costs, and charcoal-based production, which gives its pig iron a significantly lower carbon footprint than conventional coke-based material.
The US government’s recent decision to exempt pig iron from additional tariffs further reinforces this dependence on imported feedstock. The exemption reflects limited domestic merchant supply and the importance of imported pig iron in supporting EAF steel production, suggesting US import demand is likely to remain resilient.
India rebuilds export momentum
India’s pig iron exports rebounded sharply in CY’25, albeit from a relatively low base, as a reduction in US tariffs, stronger US demand, competitive pricing, and uncertainty surrounding additional tariffs on Brazilian material created new opportunities for exporters. Shipments rose to 0.60 mnt in CY’25 from 0.26 mnt a year earlier, although they remained well below the 1.30 mnt exported in CY’21. Export momentum has continued into CY’26, with shipments reaching 0.40 mnt during January-May, already equivalent to two-thirds of last year’s total.
Unlike Brazil, India remains primarily a domestic pig iron market. Exports accounted for around 7% of the country’s 8.4 mnt of merchant production in CY’25, compared with Brazil, which exported around 4 mnt, equivalent to roughly 80% of its output. However, weaker domestic demand from foundries and secondary steelmakers, coupled with rising production, has increased Indian producers’ reliance on overseas markets.
As per BigMint data, India’s apparent pig iron consumption declined to around 3.7 mnt in H1 CY’26 from 4.1 mnt a year earlier, while production increased to about 4.3 mnt. The resulting surplus has widened the gap between domestic supply and demand, making exports increasingly important to maintain blast furnace utilisation, support margins, and absorb additional output.
The US has remained India’s largest export market, accounting for around 42% of shipments in CY’25. Exports to the US increased to 0.16 mnt from 0.11 mnt a year earlier, while shipments during January-May CY’26 had already reached 0.25 mnt. At the same time, Indian producers have expanded sales to Turkiye, Nepal, Thailand, and other destinations, gradually diversifying their export portfolio beyond a single market.
Competitive economics favour exports
Indian pig iron producers remain well placed to serve export markets, supported by favourable production economics and stronger realisations overseas. Market participants estimate production costs at around INR 35,000/t ($368/t), while domestic sales currently generate margins of roughly INR 3,000-4,000/t ($32-42/t). Export sales typically offer an additional premium of INR 1,000-1,500/t ($11-16/t), which has encouraged producers to prioritise overseas shipments.
The cost advantage is reinforced by access to competitively priced Indonesian metallurgical coke under the Advance Authorisation Scheme, which exempts duties on imported raw materials used to manufacture exported products. The use of low-ash coke also improves blast furnace productivity and reduces coke consumption, helping producers maintain competitive export offers.
Reports suggest that Indian cargoes were landing in the US at around $480/t CFR New Orleans, compared to Brazil’s FOB (Ponta Da Madeira) prices of $480-$490/t. Since January 2026, Brazilian prices have climbed up 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.
India to steadily gain market share but unlikely to replace Brazil
The exemption removes a potential cost disadvantage for Brazilian suppliers, but it is unlikely to materially alter India’s export prospects. Brazil remains the dominant supplier to the US, supported by freight advantages into the US Gulf. Even if tariffs had been imposed, Brazil was unlikely to lose its leadership position.
Instead, India’s opportunity lies in supplying incremental import demand rather than displacing established Brazilian cargoes. Indian pig iron continues to be competitively priced, with offers around $480/t CFR New Orleans, compared with expected Brazilian cargoes at $495-500/t CFR.
This pricing advantage should allow Indian exporters to remain competitive despite longer transit times, particularly as US crude steel production expands and new EAF capacity comes on stream. Around 7.7 mnt of additional EAF crude steelmaking capacity has been announced in the US, while another 3.7 mnt is under construction, supporting long-term demand for imported virgin iron units.
India is also well placed to increase exports as domestic production continues to expand. Pig iron output has risen steadily from 7.1 mnt in CY’23 to 8.1 mnt in CY’24 and 8.4 mnt in CY’25, while the country’s blast furnace capacity is projected to increase by around 40% to 142 mnt by FY’30, from about 101 mnt in FY’27.
Although domestic steel demand is expected to remain robust, expanding capacity and periodic weakness in foundry and secondary steel demand are likely to leave producers increasingly reliant on export markets to maintain utilisation.
Over the longer term, tightening availability of high-quality metallics, particularly prime scrap, could further support global demand for merchant pig iron, creating additional opportunities for Indian exporters.
However, Indian producers face a longer-term challenge from the carbon intensity of coke-based blast furnace production. As global steelmakers place greater emphasis on low-carbon raw materials, Brazilian charcoal-based pig iron could retain an environmental premium in export markets, particularly if carbon-related trade measures become more widespread.
Additionally, trade policy uncertainty is likely to remain a recurring risk. Although the US has exempted pig iron from recent tariff measures, future changes to trade policy or the withdrawal of exemptions could adversely impact import economics and reduce the competitiveness of Indian cargoes.
Outlook
For Indian pig iron exports, the outlook remains favourable despite the US’s exemption to Brazil. In fact, at the current pace, India’s pig iron exports are certain to exceed CY’25 volumes, supported by firm US import demand, competitive export economics, and a widening domestic supply surplus.
Currently, although export bookings have slowed temporarily due to ongoing price negotiations, fresh export deals are expected to conclude soon, as diverting large export volumes to the domestic market could pressure local pig iron prices, which remain elevated, currently trading close to billet levels.
India’s competitive advantage may continue given that production costs remain low. Most export-oriented pig iron producers continue to source imported metallurgical coke under the Advance Authorisation Scheme, limiting the impact of recently imposed anti-dumping duties. Softer domestic coke prices in recent weeks have also helped offset any residual cost pressure, preserving the competitiveness of Indian export offers.
However, price competition will likely intensify as enhanced clarity and a widening price gap with India could push Brazilian suppliers to reduce prices.
Over the medium term, rising production, competitive export pricing, and expanding relationships with buyers in the US are also expected to steadily increase India’s role in international trade. Growing demand from Turkiye and Southeast Asia could also provide Indian exporters with an alternative outlet, reducing dependence on the US market.
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