SteelMint: PELLEX rises marginally by INR 50/t post-OMC fines auction

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, increased marginally by INR 50/t to INR 9,200/tonne (t) DAP Raipur on 22 August, 2023 as compared to the last assessment on 18 August. Around 30,000 t of deals in pellets were reported in this publishing window.

As per sources, some pellet-makers are keeping sales closed in Raipur owing to dispatch issues. Though pellet prices have increased in the region post-OMC iron ore fines auction last week. Notably, bids for fines increased by up to INR 50-750/t for the lots over floor prices. Trades on higher prices in semi-finished and steel also supported the pellet prices.

Rationale:

• PELLEX has been derived using data points, i.e, trades, offers, and bids. To download the detailed methodology, Click here.
  
  
• One deal was reported so far this week and taken into account for price calculation and hence accorded a 50% weightage for T1 trade.
  
  
• Five (5) firm offers, bids, and indicative prices were heard. Three (3) were taken for price calculation and given the balance 50% weightage.
  
  

Godawari Power and Ispat Ltd (GPIL) pellet (Fe 63.5% +/-0.5) offers increased by INR 200/t to INR 9,600/t exw-Raipur on 22 August, 2023. Other major pellet players also increased offers by INR 200/t to INR 9,200-9,300/t exw. However, a few prominent plants had closed pellet sales and are currently not offered in the market.

Semi-finished and finished steel market overview in Raipur

• Raipur P-DRI prices rise w-o-w: SteelMint's price assessment of sponge P-DRI (FeM 80%) in Raipur increased by INR 1,200/t w-o-w to INR 29,450/t exw on 22 August compared to 14 August. Prices improved by INR 350/t d-o-d. Producers were forced to raise their offers on rising steel prices in the Punjab market. But, overall, a limited number of deals were concluded.
  
  
• Raipur billet prices rise w-o-w: Billet prices in Raipur rose by INR 1,100/t w-o-w to INR 42,800/t exw-Raipur on 22 August compared to 14 August. On d-o-d basis, prices rose by INR 300/t d-o-d.
  
  

Steel prices have been exceedingly varying, making pricing certainty difficult for buyers. As a result, buyers have booked materials at higher prices. Due to this volatile market and higher offers, limited trades were seen and forced market players to only book material on need basis