SteelMint: Rourkela sponge iron index rises on active demand - 5 Dec

SteelMint's daily sponge iron, CDRI, index was assessed at INR 31,000/tonne (t) (+ INR 250) exw Rourkela on 5 December, 2022.

About 5,190 t of transactions were recorded today as against 1,000 t on 3 December.

The index rose due to active demand and market optimism. According to sources, producers were able to keep prices steady as the volume of trades increased, which has led to the rise in prices today.

Sponge iron saw a significant increase in demand as billets prices edged up. Prices in the Rourkela market rose by INR 450/t d-o-d. Spot trading remained robust all day, which contributed to the price rise.

About 5,100 t of sponge PDRI (FeM 77-79%) trades were recorded today from Odisha. Deals were concluded on DAP Raipur basis.

Trade dynamics

• Patna-based buyers were active today, placing a sizeable volume of orders with freight charges at INR 1,600-1,700/t.
  
  

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) - Twelve trades in the range of INR 30,800-31,400/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 30,903/t which is given a 50% weightage in the final price calculation.
  
  
• Other Price Indicators - bids/offers/indicative (T2) - Thirteen offers reported in the trading window and considered as T2 inputs. The average price of these thirteen was INR 31,100/t and given a 50% weightage in the final price calculation.
  
  

The final price for sponge CDRI exw Rourkela was at INR 31,002/t, rounded to INR 31,000/t exw.

Click for detailed methodology

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