East India Pellet Prices Remain Stable Amid Dull Buying in Domestic Market

Better export realizations and dull demand in domestic market has resisted any price variation in east India pellet market.

“Despite some major east India pellet makers are focussing on pellet export over better realization, demand in domestic market has not geared up. Offers continue to remain at previous week levels with no significant buying interest”, shared a Durgapur based pellet maker.

Another east India based market participant highlighted that smooth iron ore supply from Odisha alongwith cost effectiveness of lump continues sponge iron makers to prefer iron ore over pellets.

Central India pellet makers hopeful of increase in prices

Raipur pellet offers continue to remain at levels of INR 4,100-4,200/MT (basic) for Fe 63% pellets. A pellet maker highlighted that a deal has been recently concluded by a Raipur based pellet manufacturer for around 40,000 MT pellets at INR 4,100/MT (basic).

Not much reduction in pellet prices is expected in the near term. Some sponge iron manufacturers may shift to central India pellets over less supply in domestic market by major east India pellet makers as they are looking up for exports. This may lead to increase in Raipur pellet prices by INR 200-300/MT in May’16.

Southern India pellet offers remain stagnant

Bellary pellet prices continue to remain stable. Offers for Fe 63% pellets are at INR 4,450-4,500/MT (basic). A southern India based market source shared that owing to some issues in iron ore logistics at the end of some private miners, few sponge manufacturers have switched to pellets which has increased pellet sales in last couple of weeks.

Indian Pellet Prices as on 03 May’16

 Basic prices in INR/MT
* loaded to wagons
Source: SteelMint Research