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India: PELLEX rises INR 100/t ($1/t) amid active trading

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Pellets

BigMint Bureau

201 Reads

27 Sep 2024, 20:09 IST

India: PELLEX rises INR 100/t ($1/t) amid active trading

Pellet, sponge iron, billet offers increase in Raipur

Pellet export prices surge on strong buying interest

Global market rallies on approaching Chinese holidays

Pellet prices in Raipur rose amid active deals at last week's offers. Moderate buying activity was also observed at the revised prices. One major Raipur-based pellet producer increased its offers by INR 300/t ($4/t), while another one kept its prices stable. Others mostly stayed away from the market.

BigMint's bi-weekly domestic pellet (Fe 63%) index rose INR 100/t($1/t) to INR 9,100/t ($109/t) DAP Raipur on 27 September 2024, compared to the previous assessment on 24 September.

Meanwhile, major producers in Odisha raised their offers by INR 300-400/t to INR 8,800-9,100/t DAP Raipur for Fe63% pellets. A moderate number of deals was recorded from Odisha to Raipur, as buyers showed a preference for material from Raipur to that from Odisha.

Export prices of pellets from India also climbed up following improvements in the global market amid the approaching Chinese national holidays in the first week of October. Buyers showed interest, and negotiations are underway with producers in Odisha.

Rationale:

PELLEX has been derived using data points, i.e., trades, offers, bids, and indicative prices. To download the detailed methodology, click here.

Six (6) deals have been reported so far from Odisha and local Raipur based players in this publishing window. These were considered for price calculation and accorded a 50% weightage as T1 trades.

Sixteen (16) firm offers, bids, and indicative prices were heard. Eleven (11) were taken for price calculation and given the balance 50% weightage.

Factors driving PELLEX

Raipur pellet offers rise: Raipur-based pellet producers increased their offers for Fe 63% (+/-0.5) pellets by around INR 300/t ($3/t) to INR 9,300-9,400/t ($111-112/t) exw-Raipur, effective 27 September, amid strengthening demand.

Sponge iron prices up w-o-w: P-DRI prices rose sharply by INR 1,350/t ($16/t) w-o-w to INR 26,900/t ($321/t) exw-Raipur on 27 September. However, prices fell by INR 300/t ($4/t) d-o-d. According to sources, buyers opted for need-based buying, having booked enough material.

Billet prices increase w-o-w: Billet prices in Raipur increased significantly by INR 1,350/t ($16/t) w-o-w to INR 39,600/t ($473/t) exw, while prices decreased by INR 400/t ($5/t) d-o-d today. Moderate deal momentum was observed at the increased offers.

Outlook

According to BigMint's analysis, pellet prices in Raipur are likely to trend upward in the coming week. The end of the monsoon season is expected to boost construction and industrial activities, increasing demand for pellets. Additionally, strengthening sentiments in both the export and domestic markets will likely provide further support to prices.