SteelMint: PELLEX remains stable, bids fall amid NMDC's iron ore price cut

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, remained stable at INR 9,150/t DAP Raipur on 30 May, 2023 as compared to the previous assessment on 26 May. A deal of 4,000 tonnes (t) of pellets was recorded at INR 9,150/t DAP Raipur in this publishing window.

Buyers booked pellets on a need basis and are currently in a wait-and-watch mode. However, most of them are expecting a drop in Raipur pellet offers in the near-term given the price reduction announced by NMDC today.

NMDC (Chhattisgarh) has cut prices of DR-CLO by INR 300/tonne (t) and iron ore fines by INR 450/t, effective from today. The miner has fixed prices for DR CLO (Fe 67%, 10-40mm) at INR 5,220/t and iron fines (64% - 10mm) at INR 3,560/t (FoR prices from Bacheli complex, excluding royalty, DMF and NMET) with effect from 30 May.

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 this week and both were taken into account for price calculation and hence accorded 50% weightage for T1 trade.
  
  
• Eleven (11) firm offers, bids and indicative prices were heard. Eight (8) 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 30 May. Other pellet makers in Raipur slightly lowered their offers to INR 8,900-9,200/t exw in this publishing window.

Though, the buyers are eyeing a drop in pellet offers, production curtailment seen earlier this month had somehow supported offers.

SteelMint's assessment for sponge P-DRI (FeM 80%) in Raipur fell by INR 500/t w-o-w to INR 27,800/t exw. However, prices dropped by INR 100/t d-o-d. Sponge prices decreased due to a sluggish trend and weaker bids, forcing sellers to reduce their offers.