SteelMint: PELLEX falls marginally in recent deals

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, fell marginally by around INR 50/t to INR 12,100/t DAP Raipur on 31 Aug'21. Two deals were recorded by SteelMint during the current assessment period.

Raipur-based pellet makers have kept offers stable at INR 12,000-12,300/t exw. However, buyers are expecting that further price cuts are round the corner. Market participants are eagerly waiting for NMDC's iron ore price announcement for Sept'21.

A Jharsuguda-based producer has lowered offers further by INR 200-300/t and current offers have been floated at around INR 11,500/t exw. However, pellet producers in Raigarh continue to keep offers stable at INR 12,000/t exw.

As per sources, the market is still weak in terms of demand as buyers are expecting further price cuts in the next few days. State PSU miner Odisha Mining Corporation (OMC) had scheduled an iron ore lumps e-auction today. OMC fetched bids for only 238,000 t of material out of a total of 765,000 t put to auction. The bids received remained flat in line with the base price of the material.

Sponge P-DRI (FeM 80%) prices in Raipur rose marginally by INR 100/t to INR 29,600/t exw today. However, buyers resisted from booking material at current offers in the hope that prices would soften eventually on declining raw materials prices. On a weekly basis, PDRI prices have come down by around INR 600/t.

Indian pellet market overview:

Indian pellet prices continued to decline further this week by around INR 300-2,500/t across regions on an uncertain market outlook and weak sentiments.

SteelMint assesses Bellary iron ore pellet (Fe 63%) prices at INR 11,600-11,700/t exw - stable compared to the last assessment on 27 Aug.

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.
  
  
• Two deals were reported in this publishing window and considered as T1 for index calculation, given 50% weightage.
  
  
• Nine (09) firm offers and indicative prices were reported. Four were from Raipur and the rest from outside the state capital. Seven (07) were taken for price calculation and given a weightage of 50%.
  
  
• SteelMint received no bids today and, therefore, none were considered for calculation of the index.
  
  

Region-wise pellet offers and deals: