- NMDC iron ore price revision expected next week
- Raipur sponge PDRI, billet drop sharply w-o-w
Pellet prices in the domestic market have remained largely stable over the past few days, with buying activity reported at moderate levels. Market participants noted that local suppliers are holding their offers steady, while buyers continue to procure on a need-basis.
Price movements, trades
PELLEX, BigMint’s bi-weekly domestic pellet (Fe63%) index for Raipur, remained stable at INR 10,350/t ($117/t) DAP on 29 August 2025 compared to the previous assessment on 26 August.
Raipur-based producers kept their offers for Fe63% (+/-0.5%) at INR 10,100-10,300/t ($115-117/t) exw. Deals for around 10,000 t were concluded over the last couple of days by local pellet suppliers.
Pellets offered by Odisha-based suppliers were recorded at INR 9,900-10,400/t DAP in Raipur, and 5,000 t of pellets were supplied by an Odisha seller in Raipur.
Market scenario
The overall market sentiment remains weak, as both downstream steel prices and sponge iron prices have been consistently declining. In contrast, stability has been observed in pellet offers. Currently, steel prices are hovering near a two-month low, causing buyers to be increasingly cautious about making new bookings.
A Raipur buyer informed, “Steel demand is not showing any strong recovery, and with prices correcting continuously, most buyers are hesitant to build inventory.” Another buyer added, “We are only purchasing need-based material as the steel market is under pressure, and we don’t want to risk holding high-cost pellets.”
On the supply side, however, sellers pointed to raw material shortages and rising procurement costs as key reasons for keeping pellet offers firm. A supplier remarked, “Even if steel prices are down, the cost of producing pellets is not coming down due to high input costs and limited availability of iron ore. This is preventing us from reducing offers.”
Heavy monsoon conditions in central and eastern India have further hampered production and dispatches, adding to the subdued market dynamics. Market participants are also closely tracking the upcoming revision in NMDC’s Chhattisgarh iron ore prices for September delivery, which is expected next week.
“The revision in NMDC prices will be crucial for pellet price direction. If iron ore prices remain firm due to supply tightness, pellet offers may also stay supported despite weak steel,” said a steelmaker.
Rationale
- PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodology, click here.
- Two (2) deals were reported in this publishing window, and one (1) was taken for calculation. Thus, the T1 trade category was accorded 50% weightage.
- Sixteen (16) firm offers, bids, and indicative prices were heard. Thirteen (13) 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 650/t ($7/t) w-o-w to INR 23,150/t ($263/t) exw-Raipur on 29 August, while falling by INR 50/t ($0.5/t) d-o-d. The market experienced volatility throughout the day, supported by slightly positive cues from the northern India. This contributed to fluctuations in spot offers. Healthy improvement in semi-finished steel demand led to surge in bookings at varied price levels.
- Billet prices down w-o-w: Billet prices in Raipur dropped by INR 850/t ($10/t) to INR 36,600/t ($415/t) exw today. Prices decreased by INR 200/t ($2.5/t) d-o-d.
Outlook
As per BigMint, the Raipur pellet prices are expected to be volatile next week, with possible revisions in offers after the NMDC iron ore price announcement.
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