SteelMint: Rourkela sponge iron index slips on low demand, declining steel prices - 16 Sep

SteelMint's daily sponge iron, CDRI, index was assessed at INR 34,650/tonne (t) (- INR 100) exw-Rourkela on 16 September, 2022.

About 1,020 t of transactions were recorded today as against 3,100 t on 15 September.

Due to weak spot market sentiments, semi-finished steel prices in north India saw a sharp reversal leading to only a few buying enquiries for sponge. This forced suppliers to lower their offers. On the eve of the Hindu festival of Vishwakarma Puja tomorrow, the market remained essentially silent. This resulted in lower trade volumes.

Trade dynamics

• Less engagement was seen from buyers based in Patna and Jalna. Due to few purchase enquiries, and the anticipated price decline in the days ahead, spot buying on a day-to-day basis remained below average.
  
  

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) - Four trades in the range of INR 34,500-34,700/t were 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 34,656/t which is given a 50% weightage in the final price calculation.
  
  
• Other Price Indicators - bids/offers/indicative (T2) - Nineteen offers reported in the trading window and considered as T2 inputs. The average price of these nineteen was INR 34,679/t and given a 50% weightage in the final price calculation.
  
  

The final price for sponge CDRI exw Rourkela was at INR 34,668/t, rounded to INR 34,650/t exw.

Click for detailed methodology

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