Pellet manufactures in eastern India have raised pellet offers by INR 100-400/MT W-o-W.
After witnessing correction and dull demand in past few weeks, eastern India based pellet makers have sharply raised pellet offers this week. However few market sources remained skeptical whether the price hike will sustain or not.
Factors which have resulted in recent pellet price hike are as follows:
1. Hike in P-DRI prices – P-DRI prices in Durgapur have increased to INR 14,200/MT against INR 13,700/MT a week earlier.
2. Temporary suspension of iron ore dispatches from KJS Ahluwalia & Kaypee Enterprises – Iron ore dispatches from Odisha based merchant miners – KJS Ahluwalia and Kaypee Enterprises have been suspended temporarily. Over less iron ore availability, few Durgapur based sponge plants are heard to prefer pellets over iron ore.
3. Less rake availability for domestic market – Lined up iron ore & pellet export shipments have lessened the rake availability for material movement in domestic market which has also supported the pellet price hike.
4. Temporary pellet shortage in Durgapur – Rashmi Metaliks is still not heard giving offers in domestic market as it is participating in exports. Trade sources mentioned that few more Durgapur based pellet makers have lined up export shipments which has resulted in temporary shortage of pellets in domestic market. Amid lesser pellet availability in domestic market, pellet offers have moved up.
Indian Pellet Prices as on 14 Feb’17
| City | Grade (Fe %) | Basic Prices in INR/MT | W-o-W |
| Barbil* | 63 | 4,400-4,500 | = |
| Jharsuguda | 63 | 4,500 | +100 |
| Durgapur | 63 | 4,900 | +400 |
| Jamshedpur | 63 | 4,500 | +300 |
| Raipur | 63 | 4,600-4,700 | = |
| Bellary | 63 | 5,500 | -100 |
| Kandla** | 63 | 6,600 | +400 |
*loaded to wagons
**delivered
Source: SteelMint Research
Trade-wise:
1. Southern India pellet maker – MSPL is offering Fe 65% pellets at INR 5,900/MT.
2. Bilaspur based pellet maker – Rashi Steel & Power has recently concluded a deal of 10,000 MT pellets to Raigarh based plant at INR 4,600/MT (ex-Bilaspur)
3. Shyam Metaliks & Energy (Jharsuguda) sold 5,000 MT pellets at INR 4,400/MT (basic) to Raigarh based plant. Current offers at INR 4,500/MT (basic).
4. Durgapur based Super Smelters sold around 2,000 MT pellets to Durgapur based sponge plant at INR 4,900/MT.
5. Adhunik Metaliks (Jamshedpur) sold 4,000 MT pellets at INR 4,400/MT. Current offers are at INR 4,500/MT.
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