- Sponge iron manufacturers show steady demand
- Tighter availability of fines supports pellet tags
Raipur’s pellet prices increased in the last couple of days, supported by higher offers from local manufacturers and a steady sponge iron and semi-finished steel market. Recent deals indicate active buying interest, with transactions concluding at higher prices over the past few days.
BigMint’s bi-weekly domestic pellet (Fe63%) index inched up by INR 150/tonne (t) ($2/t) to INR 10,250/t ($120/t) DAP Raipur on 28 March 2025 compared to the previous assessment on 25 March. In this publishing window, deals for around 10,000 t of pellets (Fe63%) were concluded by Raipur-based producers at INR 10,250/t ($120/t) DAP Raipur. Some buyers booked around 5,000 t of raw pellets (Fe63%) at INR 10,000/t ($117/t) exw.
Raipur-based plants raised their pellet offers by INR 200/t ($2.5/t) exw yesterday, with some deals concluded at the higher values. A rise in sponge iron (PDRI) and billet prices, observed last week and at the beginning of the current week, led to an increase in pellet offers. Tighter availability of fines ahead of the financial year-end also supported pellet prices.
Raipur-based pellet producers raised their offers for Fe 63% (+/_0.5%) pellets by INR 200/t ($2/t) to INR 10,100-10,200/t ($118-119/t) exw-Raipur yesterday. Odisha-based pellet producers offered Fe 62.5%/63% grade material in Raipur at INR 9,600-10,100/t ($110-118/t) DAP.
A Raipur-based trader informed BigMint, “We have seen consistent demand from sponge iron manufacturers, which has lent support to pellet prices. However, some buyers are hesitant, waiting to make fresh bookings in the new financial year.”
Despite active trading in Raipur, Odisha’s pellet supply to Raipur remained muted, with no major deals reported. Sellers in Raipur primarily focused on clearing their previous orders, and some temporarily suspended fresh sales.
A pellet manufacturer from the region noted, “We are prioritising the dispatch of previous bookings and evaluating market trends before deciding deals on new offers.”
Rationale
- PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodology, click here.
- Two (2) deals have been reported so far in this publishing window, and two (2) were taken for calculations. The T1 trade category was accorded 50% weightage.
- Twenty (20) firm offers, bids, and indicative prices were heard. Sixteen (16) were taken for price calculation and given the balance 50% weightage.
Factors impacting pellet prices
- Sponge iron tags down w-o-w: P-DRI prices fell by INR 200/t ($2.5/t) w-o-w to INR 25,900/t ($307/t) exw-Raipur on 28 March, with tags dropping by INR 200/t ($2.5/t) d-o-d today. Trading activity was subdued today amid weak buying sentiments in the region, given the closing days of FY’25. However, earlier, steady procurement was seen, buoyed by supportive steel market sentiments.
- Billet prices stable w-o-w: Billet prices in Raipur remained largely stable w-o-w at INR 41,200/t ($484/t) exw today. However, d-o-d, prices dropped by INR 50/t ($0.5/t). The index remained largely firm throughout the day, experiencing only minor fluctuations by the end of the session. Muted demand and lower market participation, influenced by the upcoming festive holidays, kept market sentiments largely stable d-o-d.
Outlook
According to BigMint, Raipur’s pellet market is expected to remain firm in the last few days of the current financial year. However, slight price fluctuations may occur in early April as buyers reassess their procurement strategies in the new fiscal period.
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