India: PELLEX remains stable amid limited trades

• NMDC keep stable base prices for auction
  
  
• Buyers book need-based quantity
  
  

BigMint's bi-weekly domestic pellet (Fe 63%) index remained stable at INR 9,200/t DAP ($109/t) Raipur on 19 March 2024 compared to the last assessment on 16 March. Around 11,000 t deals were recorded in this publishing window.

The pellet market in Raipur remained stable this week. Few purchases were concluded by buyers on a need basis, and others remained cautious as the financial year is about to come to an end.

Godawari Power and Ispat Ltd (GPIL) kept pellet offers stable INR 9,400-9,500/t ($113-114/t) exw-Raipur. Other major pellet makers' offers from Raipur also remained stable at INR 9,100-9,200/t ($109-110/t) exw.

A buyer said, "We are holding and not in hurry to book material. The prices may drop in near term as pellet prices drop in the Odisha region. However, NMDC also not decreased the base prices for today's auction."

NMDC scheduled an auction for around 105,000 t fines (Fe64%) today at the base prices of INR 5,350/t from Bacheli mines. However, the result declaration awaited, and prices included royalty, DMF, and NMET.

In today's OMC auction, OMC conducted an auction for 1.692 mnt of iron ore fines (Fe 55-64%) on 19 March, 2024. Around 1.461 mnt of fines (86%) were booked at INR 3,100-5,000/t. Bids for fines have decreased by INR 400-950/t for majority lots against last month's bids, while few lots' bids dropped over INR 1,050-1,150/t.

Market highlights

• Sponge P-DRI down w-o-w: BigMint's P-DRI (FeM 80%) prices inched down by INR 100/t w-o-w to INR 26,450/t exw on 19 March. Meanwhile, the assessment for sponge iron in Raipur increased by INR 150/t d-o-d today. India's sponge iron prices moved up in the range of INR 50-250/t in almost all key regions, driven by active spot trading and buying interest at current price levels.
  
  
• Billet prices fall w-o-w: Billet prices in Raipur dropped by INR 500/t w-o-w to INR 39,500/t exw on 19 March. However, prices increased by INR 100/t d-o-d. Due to the impact of negative attitudes in the northern market, low demand for finished and semi-finished products, and a decline in inquiries, the index declined today, keeping transaction volumes at a reasonable level.
  
  

Rationale

• PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodology Click here.
  
  
• Two (2) deals were reported so far in this publishing window and only one taken into account for price calculation and accorded 50% weightage for T1 trade.
  
  
• Thirteen (13) firm offers, bids, and indicative prices were heard. Ten (10) were taken for price calculation and given the balance 50% weightage.
  
  

Outlook

Pellet prices in the Raipur market are expected to remain volatile in the coming days as market participants opt for a wait-and-watch mode towards the end of this financial year.