- Sellers keep offers firm amid tight availability, limiting downside
- Buyers cautious amid uncertain sponge iron demand outlook
PELLEX, BigMint’s bi-weekly domestic pellet (Fe 63%) index for Raipur, remained unchanged at INR 10,200/t ($107/t) DAP on 14 August 2026, in line with the previous assessment on 11 August. Market activity remained mixed, with some sellers concluding sizeable volumes while others struggled to attract fresh enquiries.
Pellet offers largely remained firm as sellers resisted reducing prices below INR 10,100/t ex-works. Buyers, however, continued to consider prevailing prices on the higher side and were largely comfortable bidding around INR 9,900/t ex-works. Concerns over the sustainability of the recent recovery in sponge iron prices also kept buyers cautious about aggressive procurement.
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 recorded in this publishing window. Thus, the T1 trade category was accorded weightage of 50%.
- Sixteen (16) firm offers, bids, and indicative prices were heard, of which thirteen (13) were taken for price calculation and given the balance 50% weightage.
Price movements and offers
Pellet manufacturers in Raipur, Chhattisgarh, hiked offers for Fe 62.5/63% (0.5%) grade pellets to INR 10,100-10,200/t ($105-107/t) exw recently this week.
Total deals of 33,000 t of Fe 62.5/63% grade pellets were reported to BigMint from Raipur-based sellers during the assessment period. However, overall spot trading activity remained limited, with buyers largely restricting purchases to immediate requirements.
Market scenario
The Raipur pellet market remained stable, although buying activity was uneven. Several sellers reported receiving limited or no fresh enquiries, while others managed to sell decent quantities and subsequently held back from offering further material.
Buyers continued to seek lower levels, with bids heard around INR 9,900/t ex-works. However, sellers remained firm at INR 10,100/t ex-works and above, keeping the bid-offer gap wide and limiting spot liquidity.
Market participants remained cautious about the near-term demand outlook. Some buyers questioned whether the recent recovery in sponge iron prices could be sustained over the coming days, making them hesitant to build inventories aggressively. Procurement therefore remained largely need-based.
At the same time, market views were not uniformly bearish. Some participants pointed to relatively supportive conditions in southern India, while pellet availability in parts of the eastern India belt was described as somewhat tight. Increased utilisation of pellets for captive consumption has reduced the quantity available for spot sales from some producers, limiting the scope for aggressive selling.
This regional supply situation has provided some support to pellet prices despite subdued buying in Raipur. Participants noted that tighter availability in eastern markets could also restrict inter-regional pellet flows, particularly if local producers continue to prioritise captive requirements.
Overall, the market remained caught between cautious demand and firm seller resistance. While buyers were unwilling to chase current offers amid uncertainty over sponge iron prices and downstream demand, sellers had limited incentive to reduce prices sharply given selective availability and firm conditions in some other regional markets.
Key market drivers
- Sponge iron prices rise w-o-w: Sponge PDRI prices gained by INR 700/t w-o-w to INR 26,050/t ($273/t) exw Raipur on 14 August. The improved sentiment encouraged sellers to raise offers, while several sellers were already booked with material. Buyers showed interest at the lower levels, but mostly for requirement-based purchases, as they were comfortable with the material they had already procured. Overall, trading momentum remained largely need-based, with limited enquiries and buyers making purchases only against immediate requirements. No major bulk deals were observed in the market today.
- Billet prices also strengthen w-o-w: BigMint’s billet index in Raipur rose by INR 400/t w-o-w to INR 38,400/t ($402/t) exw on 14 August. Market activity slowed ahead of the holiday and buyers remained cautious after completing sufficient bookings in earlier sessions. Weak finished steel demand continued to limit fresh billet procurement, keeping overall sentiment subdued. Trading activity remained slow, with buyers adopting a wait-and-watch approach before committing to additional volumes. The lack of support from downstream steel demand continued to weigh on billet procurement, while the holiday also contributed to lower participation. On the supply side, producers attempted to hold offers, supported by selective bookings to outside markets and rising raw material replacement costs.
Outlook
Raipur pellet prices are expected to remain rangebound in the near term, with cautious buying limiting upside. However, firm seller offers and tighter availability in some eastern markets may provide downside support.
Leave a Reply