SteelMint: PELLEX rises sharply by INR 600/t following hike in offers

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, stands at INR 10,600/tonne (t) DAP Raipur on 24 Dec'21, up by around INR 600/t against the last assessment on 21 Dec'21. Around 15,000 t of deals were reported in this publishing window.

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.
  
  
• One (01) deal was reported in this publishing window at INR 10,550/t DAP Raipur which was considered as T1 trade for calculation of the index and accorded 50% weightage.
  
  
• Nine (09) firm offers and indicative prices were reported. Six (06) were taken for price calculation and given 50% weightage.
  
  
• SteelMint received two bids but they were not considered for calculation of the index.
  
  

Central India-based pellet-makers increased offers by up to INR 700/t yesterday to INR 10,700-11,000/t exw. Price indications in Jharsuguda, Odisha are at INR 9,700-9,800/t exw, up by INR 300-700/t against 21 Dec'21.

Hike in pellet export offers and a few deals for eastern India have lifted sentiments in the domestic pellet market. SteelMint's India pellet export index (Fe 64%, 3% Al, FOB east coast) has rallied by around $10/t w-o-w to $137/t. The index has increased to close to two-month high as similar price levels were seen towards the beginning of Nov'21.

Nearly four pellet export deals of 240,000 t in all have been confirmed by SteelMint to have been concluded by eastern India-based pellet producers since the middle of last week. That apart, a few deals were concluded from central India to eastern India-based buyers.

SteelMint's assessment for pellet-based DRI (P-DRI) rose by INR 1,100/t to INR 29,900/t exw-Raipur for FeM 80% material. On a d-o-d basis prices rose by INR 500/t. Rising billet prices amidst tight sponge supply continued to support prices. However, major buyers opted to wait and watch due to lack of confidence on prevailing offers.

Indian pellet market overview: The Indian pellet market witnessed an uptrend in prices across locations, especially in eastern and central India. Pellet prices in Odisha's Barbil have edged up, as per latest reports. SteelMint's current assessment for iron ore pellets (Fe 63%) stands at INR 9,150/t, loaded on to wagon, up INR 450/t compared to the last assessment of INR 8,700/t on 17 Dec.

Region-wise pellet offers and deals: