SteelMint: PELLEX up by INR 100/t; may rise higher

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, stands at INR 11,400/tonne (t) DAP Raipur on 18 Jan'22, up INR 100/t against the last assessment on 14 Jan'22. Around 12,000-13,000 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.
  
  
• Two deals were reported both of which were considered in this publishing window as T1 trades for calculation of the index; accorded 50% weightage.
  
  
• Eight (08) firm offers and indicative prices were reported. Seven (07) were taken for price calculation and given 50% weightage.
  
  
• SteelMint received no bids and hence no bid was considered for calculation of the index.
  
  

A central India-based pellet-maker has increased offers by INR 300-400/t while the rest are keeping offers stable. Offers in central India are at around INR 11,300-11,500/t exw.

Price indications in Jharsuguda, Odisha also increased by INR 400-500/t to INR 10,900-11,000/t exw on 18 Jan.

Pellet prices have risen owing to active participation in OMC's iron ore e-auction. State-owned miner Odisha Mining Corporation (OMC) conducted an e-auction for iron ore fines and lumps on 15 Jan'22. The lump ore auction received aggressive participation and bids increased by up to INR 3,600/t over the set base price. On a weighted average basis, bids were higher by around 30% over the set base price.

Also, market sources expect NMDC to revise iron ore prices soon.

Pellet-based DRI (P-DRI, FeM 80%) prices rose by INR 800/t to INR 32,800/t. Prices remained strong on active demand followed by rising billet prices in Raipur. However, on a daily basis, prices inched down INR 200/t.

Indian pellet market overview: The Indian pellet market continues to witness an uptick in offers across regions in the range of INR 100-500/t except western India.

Region-wise pellet offers and deals: