SteelMint: PELLEX down INR 200/t on lower bids, drop in sponge iron prices

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 14,200/tonne (t) DAP Raipur on 11 Mar'22, down around INR 200/t against the last assessment on 8 March. No deal was heard in this publishing window.

Rationale:

• PELLEX has been derived using data points: i.e. trades, offers and bids. You can download the detailed methodology by clicking on this link Click here.
  
  
• No deal was reported and therefore not taken into consideration in this publishing window, and accorded 0% weightage.
  
  
• Eight (08) firm offers, bids and indicative prices were reported. Seven (07) were taken for price calculation and given 100% weightage.
  
  
• SteelMint has also received two bids and both were conssidered for the calculation of index.
  
  

Raipur-based pellets producers kept offers stable at INR 14,500/t exw for Fe 63% (+/- 0.5%). However, a couple of players from Raipur and Jharsuguda are not offering in the domestic market this week.

Sources revealed that there is disparity between offers and bids. Buyers are reluctant to make deals on prevailing offers and are are mostly using NMDC DRCLO or have pellet inventories for the next few days.

A few export deals concluded from central India have held back producers from lowering domestic offers. Next week's OMC iron ore lump and fines auction is also likely to govern the purchase pattern. State PSU miner OMC has scheduled an iron ore auction on 15 Mar'22 for 792,000 t of lump and 1.047 mnt of fines. The base price of the auction is yet to be disclosed.

Pellets-based DRI (P-DRI, FeM 80%) prices in Raipur decreased by INR 500/t to INR 43,000/t exw today on a daily basis. However, on a weekly basis, prices increased by around INR 1,200/t.

Indian pellets market overview: Domestic pellets prices saw mixed trends across regions.

• Prices in Bellary decreased up to INR 11,200/t exw today as against INR 11,350/t on 8 March. Deals for 14,000 t were confirmed in this publishing window at around INR 11,000-11,200/t exw.
  
  
• Durgapur pellet offers are heard to have decreased to INR 13,500/t exw.
  
  

Region-wise pellets offers and deals: