The price difference between P-DRI and C-DRI has reached to INR 2,000/MT levels, which should ideally be INR 1,200-1,300/MT.
Market participants mentioned that low supply of Iron ore Lump has forced Sponge manufacturers to prefer Pellets. Increasing availability of Pellet sponge (P-DRI) is the major reason for price difference.
In FY14, Indian merchant Iron ore production was about 100 MnT, out of which 30 MnT was Lump and 70 MnT was Fines. While, total Sponge iron production stood at 24-25 MnT in the last fiscal year, out of which 11 MnT was produced from Pellets and the rest from Iron ore, as per SteelMint data.
It was also noticed that P-DRI production has increased significantly on the backdrop of rising Pellet capacity. Also, Pellet consumption has increased with deteriorating availability of Iron ore.
Sponge Iron Prices with Price Difference
|
Markets |
Grade |
C-DRI |
P-DRI |
Price Gap |
|
Raipur |
79-80 |
21,700 |
19,800 |
1,900 |
|
Raigarh |
79-80 |
21,800 |
19,800 |
2,000 |
|
Rourkela |
78-79 |
20,500 |
19,000 |
1,500 |
|
Durgapur |
78 |
21,100 |
19,200 |
1,900 |
|
Bellary |
77-78 |
20,600 |
18,900 |
1,700 |
Basic prices; all taxes applicable
Next day/advance payment
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