- Odisha, Jharkhand see sharp drop; Raipur, Durgapur experience rise
- Sponge iron tags fall INR 600-1,400/t, pellet down INR 100-400/t m-o-m
The Indian pellet market witnessed largely stable trading activity in June 2025, with total trade volumes estimated at around 1.14 million tonnes (mnt) against 1.135 mnt in May. While certain regions such as Durgapur (+31%), Bellary (+20%), and Raipur (+44%) experienced firm demand and steady volumes, others, such as Barbil (-33%), Jharsuguda (-70%), and Jamshedpur (-31%), saw a notable decline in pellet transactions, despite price corrections following the Odisha Mining Corporate (OMC) auctions.
Market commentary
According to market participants, overall sentiment remained subdued due to weak demand from the finished steel and semi-finished segments. A pellet supplier from Odisha noted, “Steelmakers avoided aggressive restocking and procured material only on a need basis last month.” The absence of major bulk deals further highlighted the cautious stance adopted by buyers during the month.
Meanwhile, another market participant stated, “Despite some price softening in Barbil, we did not see much buying interest. Mills were under pressure due to poor steel realisations and demand.”
In contrast, Raipur and Bellary saw an increase in trade volumes as local sponge iron producers continued their routine procurement. The Raipur region experienced active trading, with major buyers sourcing from local sellers due to competitive pricing.
On the export front, the market remained muted, with no major deals reported in the Indian seaborne market from the east coast, which indirectly supported domestic consumption in select regions.
Factors driving pellet trades
- Bids drop in OMC’s Jun’25 auction: In OMC’s auction for 1.073 mnt of iron ore fines (Fe 51-65%) on 19 June, 1.025 mnt (95%) from different lots were booked at base prices of INR 3,600-5,600/t ex-mines, with some lots securing premiums of INR 50-950/t. Bids (weighted average) dropped by INR 250/t m-o-m. Earlier, OMC had reduced base prices by INR 500-700/t m-o-m. Falling pellet and steel prices led to lower bids m-o-m.
- Sponge PDRI falls m-o-m: Sponge PDRI prices fell significantly pan-India in June, following cautious buying and price pressure from the finished steel segments. PDRI prices saw a drop of INR 1,300/t m-o-m to INR 22,850/t exw in Raipur. Other key regions also witnessed a downtrend of INR 600-1,400/t m-o-m in June. This led to a sharp drop in pellet offers and fostered a low demand sentiment in the market.
- Pellet exports fall m-o-m: BigMint’s India pellet (Fe 63%, 3% Al) export index (FOB east coast) fell by $4/t m-o-m to $90/t in June. Very few deals from south India-based sellers were recorded for pellet exports, while sellers from Odisha did not receive any responses from buyers.
M-o-m pellet trade comparison
PELLEX, prices in other regions down m-o-m
BigMint’s monthly average domestic pellet index, PELLEX, decreased by INR 400/t m-o-m in June to INR 9,200/t DAP Raipur. Pellet prices remained under pressure following the reduction in offers by local producers amid competitive tags from Odisha and a sharp decline in sponge iron values. In the other regions, pellet prices decreased by INR 100-400/t m-o-m.
Outlook
Looking ahead, sources expect pellet trades to gain momentum in July. A steelmaker observed, “With the monsoon intensifying, steelmakers prefer pellets over iron ore due to operational ease, and we also expect some bulk domestic tenders to be finalised.” Additionally, the continued absence of imported pellet cargoes in western and southern India is likely to further bolster domestic trades.
Moreover, with several plants temporarily shut down, pellet prices in some regions may rise in July due to the tight availability of materials.
Overall, as per BigMint’s analysis, the volume of pellet trade is expected to increase in July compared to June, driven by strong demand during the ongoing monsoon season and the anticipation of bulk tenders being accepted by major steelmakers.
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