SteelMint: PELLEX falls futher by INR 300/t on competitive offers from nearby regions

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 8,400/tonne (t) DAP Raipur on 26 August, 2022, down INR 300/t compared to the last assessment on 23 August due to the decline in bids and competitive offers from nearby regions.

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 in this publishing window, hence not considered for calculation and accorded 50% weightage for T1 trade.
  
  
• Ten (10) firm offers, bids and indicative prices were reported. Seven (07) were taken for price calculation and given 100% weightage.
  
  
• SteelMint received two bids at INR 8,150/t and both considered for calculation of the index.
  
  

Pellet offers from nearby cities are getting more competitive compared to prices in Raipur. However, a pellet producer in Raipur is offering at INR 8,000-8,300/t exw (Fe 62/63), while others are holding offers.

Buyers are reluctant to conclude deals before attaining price clarity. However, a few of them procured material from outside the state due to cost-effectiveness. They are expecting enhanced supply of iron ore post monsoons which may lead to a fall in prices.

Pellet-based DRI (P-DRI, FeM 80%) prices in Raipur decreased further by around INR 800/t w-o-w to INR 34,100/t exw. On a daily basis, prices dropped by INR 100/t.

Indian pellet market overview

• As per current assessment, iron ore pellets (Fe 63%) in Durgapur fell further to INR 7,100-7,200/t exw.
  
  
• Iron ore pellet (Fe 63%) prices in Bellary moved down to INR 9,600/t exw today as against INR 9,850/t on 23 August, as per SteelMint assessment.
  
  
• A bulk deal for around 200,000 t was concluded by an eastern India-based mill at INR 6,950-7,150/t exw from eastern India based players.
  
  

Region-wise pellet offers and deals: