Stable iron ore fines prices, subdued demand and reduced profit margins have adversely affected pellet manufacturers in eastern India. A reliable source of PMAI (Pellet Manufacturers Association of India) is likely to conduct a meeting to solve these grievances. Pellet prices have come further under pressure after Odisha based merchant miners have cut lump prices but kept fines prices unchanged.
Odisha has an installed pellet capacity of 26.1 MnT. Out of which, share of merchant pellet makers is 16.85 MnT pa and the remaining share is of captive pellet plants. Hence, shutting down of merchant pellet plants will impact its availability following which merchant miners might have to cut fines prices.
|
Pellet Plants in Odisha |
Installed Capacity (MnT) | Production | ||||
| Captive | Merchant | Total | FY13 | FY14 |
FY15* |
|
| Essar Steels | 3 | 3 | 6 | – | – | 0.4 |
| Jindal Steel & Power | 4.5 | 4.5 | 9 | 3 | 3.5 | 2.5 |
| Arya Iron & Steel | 0 | 1.2 | 1.2 | 0.8 | 1 | 0.5 |
| Ardent Steel | 0 | 0.6 | 0.6 | 0.4 | 0.4 | 0.2 |
| Shree Metaliks | 0 | 0.6 | 0.6 | – | – | – |
| MSP Steel & Power** | 0 | 0.6 | 0.6 | 0.4 | 0.4 | 0.4 |
| Brahmani River Pellets | 0 | 4 | 4 | – | 0.9 | 1.26 |
| Bhusan Power & Steel ** | 1.75 | 1.75 | 3.5 | – | – | 0.6 |
| Shyam Sel** | 0 | 0.6 | 0.6 | – | – | 0.4 |
| Total | 9.25 | 16.85 | 26.1 | 4.6 | 6.2 | 6.26 |
*Till Dec’14
** These are integrated steel plants with pellet manufacturing
Source: SteelMint
Central India
- Pellet prices in Raipur remain more or less stable. Fe 63% pellets prices are assessed at INR 5,600/MT (basic). While, pellet makers are offering Fe 63% pellets at INR 5,400/MT (basic) for bulk bookings. Buying interest is seen at level of INR 5,300/MT. There are chances that pellet prices might reduce further
- Few central India based sponge iron manufacturers have bought pellets from Odisha. The landed cost of Odisha pellets (Fe 63%) is around INR 5,300/MT (delivered to plant)
Southern India
- Pellet prices in southern India have down marginal against last week. Fe 62% pellet prices are INR 4,950/MT (basic) at Bellary in Karnataka
- Market expects correction of around INR 100-200/MT in pellet prices this week owing to subdued demand
Western India
- Jindal Saw’s pellet plant is shutdown for maintenance purpose
- Kandla based steel mills are either using imported lump from South Africa or pellets of Essar Steel (Paradip), which is offered at around INR 5,100/MT (delivered at port). South African lump offers are assessed at USD 63-65/MT, CIF West Coast India for shipments to arrive in 1st week of Aug’15
Indian Pellet Prices
|
City |
Grade | Prices | W-o-W | M-o-M |
|
(Fe %) |
||||
| Barbil* | 63 | 4,100-4,300 | 0 | -100 |
| Keonjhar | 63 | 4,000 | 0 | -200 |
| Jamshedpur | 63 | 4,500 | 0 | -200 |
| Raipur | 64 | 5,400-5,600 | 0 | -200 |
| Durgapur | 63 | 4,600-5,000 | -50 | -50 |
| Bellary | 62 | 4,950 | -100 | -250 |
Basic prices in INR/MT
*as per loaded into wagons
Source: SteelMint
To find out more about the domestic use & export potential of pellet and participate in invaluable industry discussions related to raw material & latest steelmaking technologies, join us at India’s largest business conference on Iron ore, Pellet & DRI to be held in Kolkata on 13 & 14 August 2015 at Hyatt Regency. The summit is expected to be attended by 250+ companies from across the world. Register Now
Get answers to
- What will be the global iron ore prices, demand & supply scenario?
- Will Iron ore prices in China revive soon?
- How will the new MMDR Bill (2015) change the dynamics of the Indian mining industry?
- Will the export duty cut on Iron ore to 10% benefit the Indian exporters?
- Will Indian steel makers continue to import in FY16?
- What is the potential for Indian Pellet in Iran?
- How will coal block & linkage auctions impact DRI industry in India?
- Will Indian DRI dependence increase on South African and Australian Coal?
Leave a Reply