SteelMint’s bi-weekly domestic pellet (Fe 63%) index, PELLEX, stood at INR 7,450/tonne (t) DAP Raipur on 21 June 2022, down by around INR 200/t compared to the last assessment on 17 June. Around 35,000 t of pellet (Fe 62/Fe63) deals were heard in this publishing window at around INR 7,150-7,550/t DAP Raipur.
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.
- Five deals were reported for 35,000 t and all were taken into consideration in this publishing window and hence accorded 50% weightage for T1 trade.
- Ten (10) firm offers, bids and indicative prices were reported. Around five (05) were taken for price calculation and given 50% weightage.
- SteelMint received three bids at around INR 7,150/t-INR 7,250/t DAP Raipur, and only one was considered for calculation of the index.
Raipur-based pellet makers kept the offers stable at INR 7,500/t exw ($96/t). However, one of the major pellet makers still kept the sale closed. Price assessment for Jharsuguda stands at INR 6,900/t exw.
Recently, State-run Odisha Mining Corporation (OMC) has rescheduled an auction for iron ore fines and lump on 23 June 2022. Around 1.227 mnt of iron ore lumps and 1.55 mnt of fines will be put up for auction from OMC’s mines. The miner has raised the base price for lumps by up to INR 1,150/t and that for fines by up to INR 800/t as against the base prices fixed for the auction scheduled for 17 June.
On the other side, NMDC’s Chhattisgarh iron ore auction scheduled today failed to fetch any response. NMDC conducted two iron ore auctions from its Chhattisgarh mines for 109,200 t of Fe 64%-67% (indicative) grade material from its Bacheli mines, while the second auction will see 67,200 t of Fe 64-65.5% (indicative) grade ore from the Kirandul mines.
As per market sources, buyers have started preferring Chandrapur material, which is being offered at reasonable prices compared to others. Therefore, its demand in the Raipur and Chhattigarh markets is increasing. Thus, buyers continued to bid on the lower side as lumps offers from Chandrapur were heard at around INR 7,000/t FOR Raipur.
On the other hand, Hyderabad buyers were also looking to buy pellets from the Raipur market as Bellary pellet makers are facing iron ore supply issues related to dispatch permits. However, no deal has been reported yet.
Pellet-based DRI (P-DRI, FeM 80%) prices in Raipur stood at INR 31,400/t exw, up INR 800/t w-o-w. On a daily basis, sponge iron prices decreased by around INR 200/t.
Indian pellets market overview:
India pellet offers across regions dropped further by up to INR 400/t on lack of demand.
- Most of the pellet makers from Bellary did not offer today owing to lack of material availability. Delay in getting dispatch permission post the apex court’s decision led the supply-side caps.
- Iron ore pellet (Fe 63%) prices in Bellary, Karnataka remained range-bound at INR 8,450/t exw today.
Region-wise pellet offers and deals:
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