India: PELLEX rises INR 150/t (2/t) in recent deals

• Pellet offers stable in Raipur
  
  
• Sponge iron, billet offers rise sharply w-o-w
  
  
• Market awaits NMDC's price revision
  
  

BigMint's bi-weekly domestic pellet (Fe 63%) index increased by INR 150/t (2)/t) to INR 9,850/t ($118/t) DAP Raipur on 19 April 2024 compared to the last assessment on 16 April. Deals of around 15,000 t of pellets (Fe 63%) were concluded at INR 9,850/t ($118/t) DAP Raipur in this publishing window.

Pellet prices remained stable today and moderate deals were witnessed in the market. As per sources, buyers have concluded decent bookings previously and are not showing much interest amid increased offers.

Godawari Power and Ispat Ltd. (GPIL) has kept offers for Fe 63.5% and Fe 66% (+/-0.5) stable at INR INR 10,100/t ($121/t) and INR 11,600/t ($139/t) exw-Raipur, respectively. Other producers' prices, too, remained stable at INR 9,800/t ($118/t) exw.

A buyer from Raipur said, "Market activity has slowed down in the last couple of days after the bulk bookings seen at the start of this week. A few buyers remain cautious about buying and expect price correction after OMC auction."

A market observer commented that after the current price revision, landed offers to Raipur from the neighbouring region has inched closer to local offers. However, no deal from the Odisha region has been heard in Raipur. The majority of the steelmakers have remained in wait-and-watch mode over the last couple of days and they are waiting for OMC's auction.

In other key regions across India, pellet prices have increased up to INR 400/t ($6/t) after the hike in offers by pellet producers.

Market snapshots

• Sponge P-DRI prices up w-o-w: BigMint's P-DRI (FeM 80%) prices increased by INR 1,250/t ($15/t) w-o-w to INR 29,800/t ($357/t) exw on 19 April. On the other hand, prices dropped by INR 300/t ($4/t) d-o-d. Scrap shortage and price hike in the northern region had supported Raipur sponge iron prices earlier this week. However, over the last couple of days, lack of buying interest has been seen among participants.
  
  
• Billet prices rise w-o-w: Billet prices in Raipur rose by INR 2,050/t ($19/t) w-o-w to INR 44,050/t ($528/t) exw on 19 April but prices decreased by INR 250/t ($3/t) d-o-d.
  
  

Rationale

• PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodology Click here.
  
  
• One (1) deal was reported so far in this publishing window and taken into account for price calculation and accorded 50% 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 50% weightage.
  
  

Outlook:

Pellet trades in Raipur are expected to remain volatile amid decent bookings done earlier this week. Also, market participants are waiting for OMC's iron ore auction results. The sustainability of sponge iron and finished steel prices is also a matter of concern.