SteelMint: PELLEX up by INR 300/t on active deals of over 70,000 t

SteelMint's bi-weekly domestic pellet (Fe 63%) index PELLEX stood at INR 8,000/tonne (t) DAP Raipur on 28 June 2022, up by around INR 300/t compared to the last assessment on 24 June. Around 75,000 t of pellet (Fe 62/Fe63%) deals were reported at around INR 7,650-7,950/t DAP Raipur and all were taken into consideration 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.
  
  
• Three deals totalling 75,000 t were reported and taken into consideration in this publishing window and hence accorded 50% weightage for T1 trade.
  
  
• Twelve (12) firm offers, bids and indicative prices were reported. Around ten (10) were taken for price calculation and given 50% weightage.
  
  
• SteelMint received two bids at around INR 7,150- 7,950/t DAP Raipur, and only one was considered for calculation of the index.
  
  

Godawari Power and Ispat Ltd (GPIL) raised pellet offers yesterday by INR 400/t to INR 8,200/t ($104/t). Other pellet makers have also hiked offers today by around INR 400/t to INR 7,900/t ($100/t) exw.

On the other side, National Mineral Development Corporation (NMDC) conducted an auction for sale of around 20,000 t of Baila-sized lump of Fe 65.5% (indicative) grade material from its Bacheli mines today. According to sources, out of the total quantity, only 8,000 t was booked at the base price of INR 4,433/t FOR siding.

SteelMint's price assessment for sponge P-DRI (FeM 80%) in Raipur rose by INR 300/t to INR 32,900/t exw, touching a one-month high. On a w-o-w basis, sponge iron prices increased sharply by around INR 1,500/t. Active demand on rising billet prices and higher coal prices continued to lend support to the sponge iron market, SteelMint notes.

Indian pellets market overview:

Pellet offers across the regions increased on improved trade in sponge iron and billets so far this week.

• Current assessment for Odisha's Barbil iron ore pellets (Fe 63%) stands at INR 7,500/t loaded on to wagon. However, no deal has been done yet at these offers.
  
  
• Iron ore pellet (Fe 63%) prices in Bellary increased to INR 9,150/t exw today as against INR 8,750/t on 24 June, as per SteelMint assessment. Confirmed deals of 9,500 t were recorded in this publishing window at around INR 8,800-9,100/t exw. Lack of iron ore inventory amidst awaited clarity on sales and limited fresh supply kept pellet demand supported.
  
  

Region-wise pellet offers and deals:

To know more about, Indian iron ore market outlook
Iron ore and pellets conference: SteelMint Events will be hosting the 5th Indian Iron Ore & Pellet Summit on 3-4 August, 2022 at The Lalit, New Delhi. The conference will discuss key issues being faced by the iron ore and pellets industry in India. The focus will be on market dynamics, policy-related changes, growth challenges and enablers, sustainability and decarbonisation goals, the way forward and many more talk points.