SteelMint: PELLEX down by INR 600/t on lower offers, falling sponge prices

SteelMint’s bi-weekly domestic pellet (Fe 63%) index, PELLEX, down by INR 600/t to INR 13,200/t DAP Raipur on 26 Oct’21. Offers were cut sharply by pellet makers on falling sponge prices and muted pellet trade.

Central India-based pellet makers cut their offers around INR 700/t for the domestic market, sources informed SteelMint. Current offers for pellets (Fe 63%) stand at INR 13,000-13,300/t exw-Raipur.

Offers from sellers in Odisha’s Jharsuguda also moved down sharply by around INR 800-1,000/t to INR 12,200-12,500/t exw. Raigarh-based pellet makers also cut offer to INR 12,300/t however from the last few days pellet maker was not offering in the market.

Buyers have kept themselves away from making any new purchases in the current volatile market scenario and are awaiting  for clarity.

Sponge prices fall on declining coal prices – P-DRI (FeM 80%) prices in Raipur fell by INR 900/t d-o-d to INR 32,500/t exw today. On a weekly basis, sponge prices moved down by INR 2,700/t. Portside trading activity for South African RB2 (5500 NAR) grade coal continued to remain muted on 25 Oct despite offers falling further to INR 16,000/t at Gangavaram and Vizag ports (against INR 17,000/t on 22 Oct’21). In the last one-week RB2 (5500 NAR) grade coal down approximately INR 2,700/t.

Indian pellet market overview:

The Indian pellet market across the key regions showed downtrend. The offers were fallen around INR 250-900/t in today’s market.

SteelMint Bellary iron ore pellet (Fe 63%) prices have dropped to INR 12,600/t as against INR 13,000/t assessed on 22 Oct’21.

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.
• No deal was reported in this publishing window and therefore not considered as T1 trade for calculation of the index -accorded nil weightage.
• Eleven (11) firm offers and indicative prices were reported. Four were from Raipur and the rest from outside the state capital. Ten (10) were taken for the price calculation and given a weightage of 100%.
• SteelMint has received no bid therefore not taken for calculation of the index.

Region-wise pellet offers and deals: