- PDRI, billet tags decline by INR 800-1,100/t w-o-w
- Bulk deals absent as buyers in wait and watch mode
Pellet prices in the Raipur region remained largely stable this week, with trades concluded only on need-basis as buying activity stayed moderate. Market participants pointed out that sentiment remained subdued, largely influenced by falling sponge iron (PDRI) and billet prices, which declined by INR 800-1,100/tonne (t) over the past week.
Price movements, trades
PELLEX, BigMint’s bi-weekly domestic pellet (Fe63%) index for Raipur, remained stable at INR 10,350/t ($118/t) DAP on 26 August 2025 compared to the previous assessment on 22 August.
Raipur-based producers kept their offers for Fe63% (+/-0.5%) at INR 10,100-10,300/t ($116-118/t) exw. Deals for around 26,000 t were concluded over the last couple of days by local pellet suppliers.
Pellets offered by Odisha-based suppliers were recorded at INR 9,900-10,300/t DAP in Raipur but no deals were concluded amid the preference for the local material.
Market scenario
“Pellet demand is there, but buyers are cautious given the weak downstream steel market. Most of the deals are happening only when buyers have immediate requirements,” a Raipur-based steelmaker told BigMint. Another trader highlighted that many sponge producers and end-users are waiting for some recovery in finished steel demand before entering into fresh pellet bookings.
Despite sluggish buying, pellet suppliers maintained their offers unchanged, supported by regular inquiries from steelmakers. Producers also indicated that pellet availability remained tight due to the limited supply of iron ore fines, as monsoon conditions continue to disrupt mining operations and dispatches.
A pellet producer indicated, “Even though sponge and billet prices have dropped, pellet prices are stable due to the need-based demand and higher raw material costs.”
Meanwhile, buyers are currently only relying on the local producers’ material and not purchasing from the neighbouring plants. A buyer informed, “The current sponge PDRI prices are not instilling confidence to purchase bulk raw pellets. Additionally, the finished downstream steel market is not performing well, which is contributing to unclear market dynamics.”
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 in this publishing window, and Two (2) were taken for calculation. Thus, the T1 trade category was accorded 50% weightage.
- Twenty One (21) firm offers, bids, and indicative prices were heard. Fourteen (14) were taken for price calculation and given a balance of 50% weightage.
Key market drivers
- Sponge iron tags fall w-o-w: P-DRI prices declined by INR 1,100/t ($13/t) w-o-w to INR 23,300/t ($266/t) exw-Raipur on 26 August, while falling by INR 100/t ($1/t) d-o-d. Market participants noted that persistent weakness in the finished steel segment kept buyers cautious, with procurement focused on lower price levels and smaller volumes.
- Billet prices down w-o-w: Billet prices in Raipur dropped by INR 800/t ($9/t) to INR 37,000/t ($422/t) exw today. Prices decreased by INR 50/t ($0.5/t) d-o-d today. The market experienced volatility throughout the day, supported by slightly positive cues from the northern region of India. This contributed to fluctuations in spot offers. Minor improvement in semi-finished steel demand led to moderate bookings at varied price levels. However, the sentiment for finished steel stayed subdued.
Outlook
The Raipur pellet market may remain volatile in the near term, with a price drop expected due to weakening sponge and semi-finished steel markets. However, demand based on need and a raw material shortage may keep prices firm.
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