SteelMint: Rourkela sponge iron index rises INR 100/t on active bookings - 28 Dec

SteelMint's daily sponge iron, CDRI, index was assessed at INR 32,500/tonne (t) (+ INR 100) exw-Rourkela on 28 December, 2022.

About 5,300 t of transactions were recorded today as against 5,720 t on 27 December.

Active demand and an increase in offers quoted by the manufacturers kept the index strong. Strong demand resulted in higher pricing for sponge iron, a crucial raw material used to make steel. The increase in billet prices across regions has been a key factor supporting sponge iron prices.

Trade dynamics

• Average sponge iron PDRI (FeM 80%) prices in Raipur were assessed at INR 32,050/t (trade volumes stood at 1,400 t), moving in the range of INR 32,000-32,100/t exw. Pellet-based sponge iron prices in Raipur increased by around INR 100/t d-o-d on account of higher offers from sellers. Limited trade happened at such high offers as opted to wait and watch.
  
  
• Sponge iron PDRI (FeM 80%) prices in Bellary were assessed at INR 30,550/t exw (a total of 6,300 t was traded. CDRI prices stood at INR 31,550/t exw (trades volumes stood at 5,970 t today). Robust bookings were seen today. A slight increase in raw pellet prices was also seen this week as a result of strong demand for sponge iron.
  
  
• Sponge iron PDRI (FeM 78%) prices in Durgapur were assessed at INR 31,000/t (trade volume: 8,600 t), moving in the range of INR 30,900-31,000/t DAP.
  
  
• Sponge iron PDRI (FeM 78%) prices in Ramgarh were assessed by SteelMint at INR 30,450/t exw, with total trades being recorded at 2,600 t. CDRI prices stood at INR 32,950/t exw, with 2,500 t traded. As the market edged up, buyers panicked sought to secure buying positions.
  
  

Overall, the outlook for the sponge iron market remains positive, with strong demand expected to continue in the near term.

Rationale -

This index has been derived based on transactions, offers, bids and indicative price data sets. Transactions are considered as T1 and given a weightage of 50% whereas other data sets are considered as T2 and given a weightage of the balance 50%.

• Transactions (T1) - Eleven trades in the range of INR 32,200-32,500/t was recorded during the 11:30 am to 5:30 pm SteelMint trading window and considered for final price calculation as T1 inputs. The average of these transactions was INR 32,476/t which is given a 50% weightage in the final price calculation.
  
  
• Other Price Indicators - bids/offers/indicative (T2) - Fifteen offers reported in the trading window and considered as T2 inputs. The average price of these fifteen was INR 32,500/t and given a 50% weightage in the final price calculation.
  
  

The final price for sponge CDRI exw Rourkela was at INR 32,488/t, rounded to INR 32,500/t exw.

Click for detailed methodology

T1 - Trade, T2 - Offer/Bid/Indicative, *Normalized price as per methodology