Indian pellet prices continue to drift downwards this week up to INR 300/MT amid dull demand and limited trade inquiries.
Market participants highlighted that domestic pellet prices continue to reel under pressure this week too. If buying inquiries do not improve, there are chances that pellet prices may decline further in the coming week. The major factors that have resulted in further decline in pellet offers are as follows:
1. Falling P-DRI prices – Pellet sponge offers in all major markets have witnessed a drop this week over lull trades. In Durgapur, P-DRI prices have come down by INR 1,000/MT in last one week and in Raipur and Bellary the have reduced by INR 800/MT and INR 1,000/MT respectively in last one week.
2. Limited pellet trade deals – Pellet manufacturers shared that very thin buying interest is seen resulting in limited trade deals. Central India based market sources shared that buying interest remains still lower by INR 100-200/MT lower than present offers.
3. Increased pellet availability in East India over less realizations in export – Presently, pellet export offers from India are at USD 71-72/MT, FoB India. Spot pellet premium has come down to USD 14.25/MT, CFR China. Thin realization in export has resulted majority of east India based pellet makers to focus supply in domestic sales. Increased pellet supply in domestic market coupled with dull demand has led to limited trade deals.
Indian Pellet Prices as on 03 May’17
|
City |
Grade (Fe %) | Basic Prices in INR/MT |
W-o-W |
| Barbil* | 63 | 4,200-4,300 | -300 |
| Keonjhar* | 63 | 4,000 | -300 |
| Jharsuguda | 63 | 4,800 | -200 |
| Durgapur | 63 | 4,600-5,000 | -250 |
| Raipur | 63 | 4,700-4,800 | -200 |
| Bellary | 63 | 6,200 | -150 |
| Kandla** | 63 | 5,400 | = |
*loaded to wagons
**delivered
Source: SteelMint Research
Trade-wise:
1. Bilaspur based Rashi Steel pellet offers are at INR 4,800/MT (ex-Bilaspur)
2. Southern India based MSPL is offering Fe 65% grade pellets at INR 6,600/MT (basic)
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