SteelMint: PELLEX up by INR 300/t in recent trade, exports pick-up

SteelMint's bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 12,600/tonne (t) DAP Raipur on 8 April, 2022, up around INR 300/t compared with the last assessment on 5 April. One deal was reported for around 10,000-15,000 t in the last few days in Raipur, Chhattisgarh.

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 deal was reported (adjusted with the necessary grade adjustment) and taken into consideration in this publishing window . Hence accorded 50% weightage for T1 trade.
  
  
• Eight (08) firm offers, bids and indicative prices were reported. Seven (07) were taken for price calculation and given 50% weightage.
  
  
• SteelMint received no bids hence not considered for calculation of the index.
  
  

Raipur, Chhattisgarh-based pellet producers have decreased domestic offers by INR 700-800/t ($9-11/t) on 6 April, from INR 13,500-13,800/t ($179-182/t) to INR 12,800-13,000/t exw ($169-171/t). Although buying interest at current offers remains low from sponge players, a recent pick-up in export inquiries may support domestic offers.

However, in the domestic market not much deals are happening on falling sponge iron, billet prices and the competitive landed cost from nearby regions, especially Odisha and West Bengal.

Jharsuguda-based producers are offering at INR 10,800-11,000/t exw. However, bids are hovering at still lower levels.

Buyers indicated certain gaps between offers and bids and still holding buying deals. Buyers are expecting Raipur pellet offers to drop.

Pellets-based DRI (P-DRI, FeM 80%) prices in Raipur decreased to INR 36,000/t exw, down by around INR 2,200/t w-o-w. On a daily basis, sponge iron prices also dropped around INR by 500/t.

Pellet export deals gain momentum- SteelMint has observed in the last few days some decent deals for pellet exports have been done. SteelMint's pellet export index increased by $13 w-o-w.

An Odisha-based pellet producer has concluded an export deal for 55,000 t of pellets (Fe 63%, 3% Al), which was heard concluded at $190/t CFR China for April, 2022 shipment, sources confirmed. In another deal an Indian pellet producer has concluded three parcel export deal for around 150,000 t (Fe 62.5%, 2% Al grade material) at $182-183/t FOB for April, 2022 shipment, sources confirmed. The export market has regained momentum following expectations that demand might resurface as domestic concentrate prices in China have started climbing.

Indian pellets market overview: Domestic pellet prices are mostly stable across the regions except Jharsuguda and Barbil offers down further.

• Iron ore pellet (Fe 63%) prices in Bellary, Karnataka remained range-bound at INR 10,000/t exw today, as per SteelMint assessment. Deals for 6,000 t were confirmed in this publishing window at around INR 10,000/t exw.
  
  

Region-wise pellets offers and deals: