SteelMint: PELLEX remains stable as market awaits NMDC price revision

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, remained stable at INR 9,150/t DAP Raipur on 26 May 2023 as compared to the previous assessment on 23 May. Around 40,000 t of deals of Fe 63/63.5 grade were recorded at INR 9,350-9,450/t DAP Raipur in this publishing window.

Rationale:

• PELLEX has been derived using data points, i.e. trades, offers, and bids. To download the detailed methodology, Click here.
  
  
• Two (2) deals were reported so far this week and both were taken into account for price calculation and hence accorded 50% weightage for T1 trade.
  
  
• Twelve (12) firm offers, bids and indicative prices were heard. Seven (7) were taken for price calculation and given the balance 50% weightage.
  
  

Godawari Power and Ispat Ltd (GPIL) pellet offers (Fe 63.5% +/-0.5) remained stable at INR 9,300/t ($112/t) exw-Raipur on 26 May. The player was out of the market for a couple of weeks due to plant maintenance. Other pellet makers in Raipur kept their offers stable at INR 9,000-9,200/t exw.

However, buyers are expecting a price cut in the upcoming days. There is still a gap between offers and bids as sponge prices have fallen. Most of the buyers are eagerly waiting for the NMDC price revision. As per sources, NMDC may revise its iron ore prices in the upcoming days.

SteelMint's assessment for sponge P-DRI (FeM 80%) in Raipur moved down by INR 1,500/t w-o-w to INR 27,950/t exw on 26 May 2023. However, prices dropped by INR 350/t d-o-d. There was little demand for semi-finished and finished steel as trading was quiet. As a result, the market was relatively calm this week.