India: PELLEX remains stable following lack of trading activities

• Buyers remain sidelined amid election results
  
  
• Pellet offers stable in Raipur, trade muted
  
  

BigMint's bi-weekly domestic pellet (Fe63%) index remained stable at INR 11,000/t ($132/t) DAP Raipur on 4 June, 2024 compared to the last assessment on 31 May. No deal was recorded in the Raipur region so far this week. However, a pellet producer from Raipur sold 25,000 t of higher grade pellet (Fe 66%) at INR 13,650/t ($134/t) DAP Raipur in this publishing window.

The Raipur pellet market remained muted as market players waited for parliamentary election results. No major trading activity was witnessed in the region as most of the steelmakers remained sidelined this week. The pellet makers also kept their previous offers stable today.

GPIL has kept pellet offers of Fe 63.5% and Fe 66% stable at INR 12,000/t ($144/t) and INR 13,500/t ($162/t) exw-Raipur, respectively. Other producers' offers were recorded at INR 11,400-11,500/t ($137-138/t) exw.

The buyers also remained cautious about purchasing pellets from the Odisha region. The number of bids also remained less compared to the past week. However, few Odisha-based pellet producers kept Raipur landed prices at INR 10,500-10,800/t ($129-132/t) DAP Raipur but no deals were recorded in this publishing window.

A market participant said: "No one was interested in purchasing raw pellet in the last couple of days as they remained sidelined as steelmakers were waiting for today's parliamentary election. The market activity remained sluggish and sellers also have not done any correction in the offers. The market picture will be clearer in the next few days."

NMDC returned to normalcy in rake movement leading the pellet market under pressure. However, in May buyers booked decent quantity of pellets both from Raipur and outside for pre-monsoon restocking. As per the sources, they have now the sufficient material for the next few weeks.

Steel market updates

• Sponge P-DRI stable d-o-d: P-DRI prices remained stable d-o-d at INR 28,500/t ($343/t) exw on 4 June. Meanwhile, prices rose by INR 300/t ($4/t) w-o-w. Minimal trading activity was reported today due to weak market sentiments amid election results.
  
  
• Billet prices drop d-o-d: Billet prices in Raipur fell by INR 350/t ($4/t) d-o-d to INR 45,000/t ($539/t) exw today, while prices increased by INR 800/t ($10/t) on a w-o-w basis. The billet prices dropped amid the weak market sentiments. There was a lack of demand in the region.
  
  

Rationale

• PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodology Click here.
  
  
• No deal was reported so far in this publishing window and was not taken into account for price calculation and accorded a 0% weightage for T1 trade.
  
  
• Thirteen (13) firm offers, bids, and indicative prices were heard. Nine (9) were taken for price calculation and given the balance 100% weightage.
  
  

Outlook

Pellet prices in Raipur may remain volatile as pellet makers revise their offers for fresh buying interest in the next few days. However, it will be interesting to see how the market will react after the election results.