The price of iron ore pellets has increased in the month of August as compared to last month, reflecting a steady growth driven by strong domestic demand from the steel and sponge iron sectors.

As per our sources, the export prices remained subdued at approximately ₹6,000- ₹6500 per ton, creating a price gap of around ₹1,500-₹1800, which favoured domestic sales. This divergence was primarily seen due to stronger pricing leverage in the domestic market, where demand remained robust and margins were better for suppliers on the eastern coast.

On the other hand, Indian pellet export activity remained limited due to a persistent bid-offer mismatch, with Chinese prices in the range of ₹107-108 per ton CFR while Indian exporters were demanding higher rates above $120. This resulted in domestic consumption exceeding exports, although certain regions, such as western and southern India, have maintained export competitiveness, particularly for low-alumina pellets.

Outlook:

Thus, there has been an anticipation that the Pellet prices are expected to maintain moderate upward momentum, supported by projected growth in domestic steel production, continuous adoption of energy-efficient pellets, and potential supply-side pressures from capacity expansions. However, export might remain tied to narrowing price gaps, stabilizing input costs, and a revival in global demand.