Analysis
August 19, 2026
Brazil pig iron activity heating up for US buyers
Written by Stephen Miller
There has been a resumption in pig iron activity in Brazil on the part of US-based steel mill buyers. Sources have confirmed there were two fresh deals concluded from South Brazil.
SMU spoke to a trader in the Brazilian market who said last week that a large channel in the Minas Gerais state sold a 55,000 metric-ton (mt) cargo to the US at a price of $460/mt FOB Vittoria/Rio. This was at the same price level as the previous cargo sold in late July after the tariffs were lifted. Our source commented, “Seems this number is prevailing for the time being.”
He was correct since shortly afterwards another prominent channel concluded a similar cargo destined for the US at the same level. Both of these cargoes are slated for September loading. The ocean freight into the Gulf is estimated at $30-35/mt, according to the seller, making the CFR price $500-505/mt with financing costs included.
Indian material in play?
In our last update, we reported there was debate over whether pig iron prices from India would severely undercut Brazilian producers. However, cargoes from India at the theoretical prices of $375/mt FOB were not ever concluded. The prices are now being reported from various sources at about $435-440/mt FOB with freight to US of roughly $50/mt. This is an increase from the $415-420/mt FOB prices earlier this month.
Ukraine war fallout
The apparent reason for the increase is a sharp decrease in shipments from Ukraine due to naval battles in the Black Sea. Even more ominous is the partial wartime destruction of two large steel mills that produce and export a sizable amount of Ukrainian pig iron production. Production at these two mills has been suspended.
The Ukrainian State Customs Service reported in July only 49,000/mt of pig iron was shipped to the US. This is about 100,000/mt less than the average monthly tonnage this year.
Given this situation, Brazilian producers held their ground on prices, even in the face of lower prices from India. Once it became apparent that Ukrainian shipments were suspended, there was no longer any pressure to drop their offer prices. However, it should be noted the $460/mt sales price is $40/mt lower than May price levels and no tariffs are tacked on to these new transactions.
We also mentioned in our last update it was questionable if India can continue to supply enough material to the US to significantly cut into US demand from Brazil. We don’t know yet, but without Ukrainian supplies, which have totaled ~900,000/mt this year, it should be safe to assume US reliance on Brazil will continue.
