- Pellet offers stable in Raipur amid limited deals
- Landed offers from Odisha equal to local prices
- Drop in sponge iron, billet prices point to subdued demand
BigMint’s bi-weekly domestic pellet (Fe 63%) index remained stable at INR 9,600/t DAP ($115/t) Raipur on 9 April 2024 compared to the last assessment on 5 April. A deal for around 10,000 t of pellets (Fe 63.5%) was recorded at INR 9,850/t ($118/t) DAP Raipur in this publishing window. Additionally, another deal for 10,000 t of higher-grade pellets (Fe 66%, +/-0.5%) was recorded at around INR 11,150/t ($137/t) DAP Raipur.
Pellet offers in Raipur remained stable this week and moderate deals were recorded in the region. Most buyers had already booked decent quantities last week amid sharp increase in the sponge iron and finished steel prices.
A buyer from Raipur said, “We had booked sufficient quantities even at revised higher offers following the rise in the semi-finished and finished steel prices. However, this week, the market witnessed a drop in prices. Currently, pellet prices in the neighbouring regions are nearly equal.”
Bids from a few buyers were INR 500/t lower than offers floated by suppliers this week.
A source informed that a few deals have been concluded recently and buyers are doubtful about the price trend. However, a few participants engaged in need-based bookings even during the Navratri and Gudi Padwa festivals.
Notably, NMDC Chhattisgarh has scheduled an iron ore auction on 12 April. Around 42,000 t of run of mine ore (10-150 mm, Fe 65.5%) will be auctioned from the Kirandul mines. Around 33,600 t DRCLO (10-40 mm, Fe 67%), 8,400 t ROM (10-150 mm, Fe 65.5%), and 92,400 t fines (Fe 64%) will be auctioned from the Bacheli mines. However, the base prices are yet to be declared by the miner.
Other highlights:
- Sponge P-DRI prices soften: BigMint’s P-DRI (FeM 80%) prices decreased by INR 750/t ($9/t) w-o-w to INR 29,000/t ($348/t) exw on 9 April compared to 5 April. Meanwhile, prices dropped INR 400/t ($5/t) d-o-d. Buying activity in the sponge iron market remained slow today as buyers had already placed sufficient orders last week; no major buying activity was seen. Another key reason behind limited buying was the festive lull in the market.
- Billet prices drop: Billet prices in Raipur fell by INR 900/t ($11/t) to INR 42,300/t ($508/t) exw on 9 April against 5 April. Prices decreased by INR 300/t ($4/t) d-o-d. Sluggish demand was seen in the semi-finished and finished steel segments during the first two days of the week. This subdued demand can be attributed to the ongoing festive holidays.
Rationale
- PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodology Click here.
- One (1) deal was reported so far in this publishing window and taken into account for price calculation and accorded 50% weightage for T1 trade.
- Twelve (12) firm offers, bids, and indicative prices were heard. Ten (10) were taken for price calculation and given the balance 50% weightage.
Outlook:
Pellet prices in the Raipur market may remain supported this week. However, as per BigMint analysis, prices will depend on sponge iron and overall steel price trends.