Analysis
May 14, 2026
Brazil pig iron market low on production
Written by Stephen Miller
Although price levels have been quite favorable recently in the Brazilian pig iron market, there does not seem to be enough production to keep the pipeline intact.
Sources say there has been scant new activity in the pig iron market there.
The dearth in production is being blamed on rainy weather, which is affecting the production of charcoal used as the reductant for ironmaking in Brazil, as opposed to coke.
SMU contacted a trader in Brazil who told us the market there is very tight.
“Producers are trying to increase production but meeting reduced offers of charcoal. This will surely reduce offers for July/August shipment,” he warned.
The last verified US sale of pig iron from South Brazil was reported at $481.50 per metric ton (mt) FOB Brazil ($511.50).
Since then, SMU has not been able to confirm additional cargoes concluded for shipment to the US. We heard from a US-based pig iron executive who also said he has not heard of anything since then.
He added he does expect continued firmness to increasing prices for basic pig iron and prime grades of scrap.
The source in Brazil said he had heard of a partial cargo sold by a southern channel at a rumored price of $500/mt FOB.
He said this may be part of a handymax-sized cargo sold to Italy, which is thought to have been concluded at $535/mt CFR Italy.
All this does need final confirmation, but SMU has heard from another large channel that this price is probably correct. The director told us his channel has only a July shipment cargo available and the asking price is $495-500/mt FOB Rio/Vitoria.
The US mills will need to have additional supplies of pig iron until South Brazil returns to normal production.
The northern Brazilian producers are limited in the amounts available, weather notwithstanding. Ukraine has been a significant supplier so far this year. However, pig iron production has been reduced due to restrictive operations at two exporting producers there. This is being caused by wartime issues.
There have been reports of sales of Indian pig iron to the US. This activity needs to be confirmed. However, the recent reductions of tariffs to 10% for India, coupled with the increased prices for Brazilian material, may have made Indian pig iron workable for the US, despite the freight disadvantage.
