India: PELLEX remains stable on lack of deals

• Pellet offers stable post-Holi festival
  
  
• Bids, offers gap still exists
  
  
• Sponge, finished steel offers improve w-o-w
  
  

BigMint's bi-weekly domestic pellet (Fe 63%) index remained stable at INR 9,200/t DAP ($109/t) Raipur on 27 March 2024 compared to the last assessment on 22 March. No deals were recorded in this publishing window as buyers were away from the market due to the Holi festival.

The pellet offers in Raipur remained unchanged and plant offers remained intact during holidays. Offers and bids still have gap around INR 200-300/t. Buyers are on wait-and-watch mode towards the end of current financial year ending.

Godawari Power and Ispat Ltd (GPIL) kept pellet offers stable at 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 market participant commented: "The buyers expected a drop in the pellet prices after the Holi festival but the plant kept prices stable. Due to this, prices gap between local offers and landed offers to Raipur from neighbouring region had shrunken as there was some price cut witnessed in Odisha region."

Another trader from Raipur said: "The pellet offers in Odisha region dropped slightly amid weak demand. However, Raipur sponge makers are waiting for local plants' price cut and did not inquire for the outside Raipur region material. Few regions landed prices were INR 200-500/t ($2.5-6/t) less against the local offers."

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 not taken into account for price calculation and accorded 0% weightage for T1 trade.
  
  
• Sixteen (16) firm offers, bids, and indicative prices were heard. Twelve (12) were taken for price calculation and given the balance 100% weightage.
  
  

Market highlights

• Sponge P-DRI up w-o-w: BigMint's P-DRI (FeM 80%) prices increased by INR 450/t ($6/t) w-o-w to INR 26,950/t ($323/t) exw on 27 March. Meanwhile, the assessment for sponge iron in Raipur improved by INR 250/t ($3/t) d-o-d today. Buying activity improved in today's trading session, with significant surge in bookings after the long holidays creating demand for sponge iron in the spot market which resulted in increased spot offerings d-o-d.
  
  
• Billet prices rise w-o-w: Billet prices in Raipur rose by INR 500/t ($6/t) w-o-w to INR 40,100/t ($481/t) exw on 27 March. Additionally, prices increased by INR 300/t d-o-d. The index moved up due to increased number of enquiries post-holiday purchases. There was improvement recorded in transaction volumes of semi-finished and finished steels.
  
  

Outlook

Pellet prices in the Raipur market are expected to remain under pressure in the coming days amid sluggish mood of local buyers coupled with subdued export market offers.