India: PELLEX falls by INR 100/t ($1/t) ahead of OMC auction

• Sponge iron, billet tags fall w-o-w amid reduced trades
• Buyers await fresh offers post OMC auction on 19 Apr

Pellet prices in Raipur remained under pressure this week, as the market witnessed moderate trading activity ahead of the iron ore auction from the Odisha Mining Corporation (OMC), scheduled for 19 April. Local sellers concluded a few deals, while some trade movements were also observed from the Odisha region. Sellers in Raipur maintained their offers, although competitive prices from Odisha added pressure to market sentiment.

PELLEX, BigMint’s bi-weekly domestic pellet (Fe63%) index, dropped by INR 100/t ($1/t) to INR 10,150/tonne (t) ($119/t) DAP Raipur on 18 April 2025 compared to the previous assessment on 15 April. In this publishing window, deals for around 10,000 t of pellets (Fe63%) were concluded by Raipur-based sellers at INR 10,250/t ($120/t) DAP. Around 5,000 t of pellets (Fe63%) were purchased from Odisha at INR 9,900-10,000/t ($115-116/t) DAP Raipur.

Meanwhile, prices of sponge iron and billets declined this week, prompting several pellet buyers to adopt a cautious wait-and-watch approach. A steelmaker commented, “There is uncertainty in the market due to falling steel prices. Buyers are not in a hurry to book pellets at current rates.”

Raipur-based pellet producers kept their offers stable for Fe63% (+/- 0.5%) material at INR 10,100-10,200/t ($118-119/t) exw-Raipur. Odisha-based pellet producers offered Fe62.5/63% grade in Raipur at INR 9,600-10,000/t ($111-117/t) DAP.

A local pellet producer stated, “We are offering the same prices, but the recent drop in finished steel prices has weighed on our trading volume.”

Market participants eagerly awaited the results of the upcoming OMC auction, which are expected to shape future buying strategies. OMC raised the base prices of iron ore fines by INR 100/t for tomorrow’s auction.

A buyer informed BigMint, “The market direction will become clearer next week following OMC’s iron ore auction. We may see new pellet offers come in, depending on the auction trends.”

Trade volumes are likely to improve once fresh offers are floated by sellers, and participants expect more clarity in prices in the coming days.

Rationale

• PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodology, click here.
• Three (3) deals were reported so far in this publishing window and taken for calculations. The T1 trade category was accorded 50% weightage.
• Nineteen (19) firm offers, bids, and indicative prices were heard. Fifteen (15) were taken for price calculation and given the balance 50% weightage.

Factors impacting pellet prices

• Sponge iron tags fall w-o-w: P-DRI prices dropped by INR 650/t ($8/t) w-o-w to INR 25,600/t ($300/t) exw-Raipur on 18 April, with tags inching down by INR 100/t ($1/t) d-o-d today. Buyers adopted a wait-and-watch approach due to an unstable market, which led to subdued procurement and, consequently, a drop in sponge iron prices.
• Billet prices drop w-o-w: Billet prices in Raipur decreased by INR 850/t ($10/t) w-o-w to INR 41,000/t ($480/t) exw today. Furthermore, d-o-d, prices edged down by INR 150/t ($2/t). The ongoing demand slump triggered further corrections in spot offers, with buyers maintaining a cautious stance amid uncertainty. Sellers reduced prices to stimulate trade, but limited buyer participation kept the market subdued.

Outlook

According to BigMint’s analysis, in the near term, Raipur’s pellet prices will be determined by the outcome of OMC’s iron ore auction. Trading volumes may also increase with fresh offers.

Correction: Raigarh pellet deal price has been updated to INR 8,800-9,000/t where previously mentioned INR 8,800-10,000/t exw.