SteelMint: PELLEX slips to one-month low tracking drop in offers

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, has fallen sharply by INR 650/t to INR 12,350/t DAP Raipur on 9 Nov'21. The index has hit its lowest point in over a month, with similar price levels last seen in early Oct'21. No deal was reported in this publishing window.

Central India-based pellet makers slashed offers today by around INR 700-800/t for the domestic market, sources informed SteelMint. Current offers for pellet (Fe 63%) stand at INR 12,200-12,500/t exw-Raipur.

Sellers in Odisha's Jharsuguda have also reduced offers by around INR 500/t to INR 11,500/t exw; however, market participants expect that prices are likely to fall in the coming days.

Lack of trades in any significant way and falling sponge iron prices over the last few days have forced pellet producers to cut offers. However, buyers are not interested in current offers, as they are expecting further cuts that could boost their margins. Disparity between bids and offers still prevails in the market.

SteelMint's assessment for sponge P-DRI (FeM 80%) in Raipur fell today by INR 700/t to INR 30,600-30,900/t exw.

Indian pellet market overview:?Pellet exhibited mixed trends today, as prices fell in Bellary and some markets in central India, while remaining stable in Kandla and Durgapur.

Bellary iron ore pellet (Fe 63%) prices fell to INR 11,700-11,800/t exw as against?INR 12,000-12,100/t on 2 Nov. Deals for 23,500 t were heard at INR 11,600-11,800/t exw.

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.
  
  
• Twelve (12) firm offers and indicative prices were reported. Eleven (11) were taken for the price calculation and given a weightage of 100%.
  
  
• SteelMint received one bid at INR 11,150/t DAP Raipur, which was not considered for calculation of the index.
  
  

Region-wise pellet offers and deals: