SteelMint: PELLEX rises further by INR 100/t in recent deals

SteelMint’s bi-weekly domestic pellet (Fe 63%) index, PELLEX, increased further by INR 100/t to INR 13,100/t DAP Raipur on 8 Oct’21. Around 35,000 t of confirmed deals have been concluded in the Raipur market in the last few days but only 20,000 t of deals were considered for calculation during the present publishing window.

Raipur-based pellet makers kept offers unchanged at INR 13,000-13,500/t exw. However, a sizeable volume of deals was concluded this week. One deal was heard concluded by a Durg-based pellet maker into the Raipur market.

Though deals are happening but buyers are still cautious about taking buying decisions in a volatile market. Coal prices are extremely high, which has made steelmakers anxious about buying decisions at increased offers.

Raipur sponge P-DRI (FeM 80%) prices inched down, d-o-d, by INR 500/t to INR 33,300/t exw. On a weekly basis, prices have moved down by INR 700/t. Weak demand and lack of bookings in the finished steel segment have dragged prices down in other product verticals.

Indian pellet market overview:

Indian pellet prices have moved down sharply across regions in this publishing period from INR 250/t to INR 400/t except Jamshedpur.

Bellary iron ore pellet (Fe 63%) prices have decreased to 12,700-12,800/t exw as against INR 13,000/t on 5 Oct, as per SteelMint assessment. Confirmed deals of about 13,000 t were recorded at around INR 12,600-12,800/t exw.

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 were reported for around 35,000 t but two deals were considered as T1 trade and factored into calculation of the index, given 50% weightage.
• Eight (8) firm offers and indicative prices were reported. Three were from Raipur and the rest from outside the state capital. Five (5) were taken for the price calculation and given a weightage of 50%.
• SteelMint also received one bid at INR 12,150/t (DAP, Raipur) which it was not considered for calculation of the index.

Region-wise pellet offers and deals: