India: PELLEX remains stable in absence of trades

• Pellet offers stable
  
  
• Lack of deals witnessed amid festival
  
  
• Buyers in wait-and-watch mode
  
  

BigMint's bi-weekly domestic pellet (Fe 63%) index remained stable at INR 9,150/t DAP ($109/t) Raipur on 8 March 2024 compared to the last assessment on 5 March. No deals were recorded in this publishing window due to less activities owing to festivities.

The pellet market remained silent in the past two to three days despite offers reduced by the local pellet makers. Meanwhile, sponge and finished steel prices also improved in the last one week. Buyers are mostly reluctant to book any material at the last month of this financial year but expected to buy from the next month (in April). They are avoiding to take any inventory pressure to close this financial year.

A prominent pellet maker from Raipur didn't drop the offer as they had already sold enough material in the last two to three weeks. Bids from buyers narrowed down followed by cuts announced in Raipur for pellets.

A buyer informed, "Few buyers booked enough material at the start of the week while few are yet to decide for pellet purchase. We are expecting that Raipur pellet offers may see a drop in the coming days owing to the weak export market."

A pellet maker commented on the current market trend and said that we are receiving the inquiry for the material but the deals are under negotiation.

On the other hand, the financial year 2024 is also coming to an end, so few bulk deals may be recorded in the Raipur as plants expected to try to sell the maximum volume at prevailing prices.

Market highlights

• Pellet offers stable: Godawari Power and Ispat Ltd (GPIL) has kept pellet offers stable at INR 9,200-9,300/t ($111-112/t) exw-Raipur today. Other major pellet makers from Raipur have also kept the offer stable at same prices of INR 8,900-9,000/t ($107-108/t) exw.
  
  
• Sponge P-DRI rises w-o-w: BigMint's P-DRI (FeM 80%) prices increased by INR 550/t w-o-w to INR 26,800/t exw on 8 March. The assessment for sponge iron in Raipur rose by INR 100/t d-o-d today. The market was a little quiet today due to Maha Shivratri, which resulted in a few inquiries about buying. As an outcome, trading activity was steady across all regions while recording a 12% daily gain.
  
  
• Billet prices up w-o-w: Billet prices in Raipur improved by INR 700/t w-o-w to INR 40,200/t exw on 8 March. Meanwhile, prices increased by INR 200/t d-o-d. Despite the market's silence due to Maha Shivratri, the index increased little today as rising offers and trades ended in a similar price range.
  
  

Rationale

• PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodologyClick here.
  
  
• No deals were reported so far in this publishing window and were not taken into account for price calculation and accorded 0% weightage for T1 trade.
  
  
• Fifteen (15) firm offers, bids, and indicative prices were heard. Ten (10) were taken for price calculation and given the balance 100% weightage.
  
  

Outlook

Pellet prices in the Raipur market are expected to remain under pressure following the subdued export demand along with a wait-and-watch stance from buyers. However, improvement in sponge and finished steel offers may support local pellet offers.