SteelMint: Rourkela sponge iron index rises by INR 950/t on strong demand – 3 Mar

SteelMint’s daily sponge iron, CDRI, index is assessed at INR 39,000/tonne (t) (+ INR 950) exw Rourkela on 3 Mar’22.

About 4,950 t of transactions in CDRI were recorded by SteelMint today against 3,490 t on 2 March.

The index rallied as demand continued to remain active on optimistic trends amidst expectations of a further surge in prices. Thus, with rising prices, spot trades also remained supported.

A bunch of deals were reportedly concluded for West Bengal, with freight charges at around INR 1,600-1,700/t, SteelMint learnt from sources.

The current price of iron ore-based DRI (CDRI) for FeM 78% material in Durgapur is at INR 40,700/t DAP, while Odisha (Rourkela) sponge iron prices are assessed at around INR 40,600-40,700/t DAP Durgapur for FeM 79-80% material.

With rising coal prices globally, market participants are hopeful that sponge prices will continue to strengthen in the coming days.

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) – Eight trades were recorded in the 11:30 am to 5:30 pm SteelMint trading window and considered for final price calculation as T1 inputs. Out of which two trades were recorded at INR 39,500/t, two deals at INR 39,000/t, and one deal each at INR 40,000/t, INR 38,750/t, INR 38,700/t, and INR 38,100/t. The average price of these eight transactions was INR 39,040/t and 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 39,000/t and given a 50% weightage in the final price calculation.

The final price for sponge CDRI exw Rourkela was at INR 39,020/t, rounded to INR 39,000/t exw.

Click for detailed methodology

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