- Bids remain lower than offers
- Only need based bookings
- Export market subdued
BigMint’s bi-weekly domestic pellet (Fe 63%) index remained stable at INR 9,550/t DAP ($115/t) Raipur on 16 February 2024 compared to the last assessment on 13 February. A deal of 15,000 t was recorded at INR 9,550/t DAP Raipur in this publishing window. Landed offers from Odisha were lowered by INR 200-400/t than local Raipur offers, sources informed.
Pellet prices in Raipur remained stable this week. Buyers were not interested in booking material currently as it was not feasible for them. Most buyers remained cautious and expected price reductions from the plant in the coming days.
A pellet buyer said, “We are waiting for price reduction by the pellet makers to book new material in the inventory. From the Odisha region, we are getting inquiries at less than INR 200-300/t against the local pellet offers. Seeing the current market scenario, plants of Raipur may cut prices in the coming days.”
However, pellet makers are waiting for the OMC iron ore auction scheduled on 19 February. Also, NMDC’s iron ore price revision from Chhattisgarh mines is around the corner, which is a key factor to be watched out.
A pellet producer said, “The export market is also on a downtrend amid the CNY holidays. There was no firm inquiry from the seaborne market in the last few days. However, demand from the domestic market also decreased while a few buyers’ bids remained INR 200-300/t against the offers.”
The pellet export market also remained subdued this week along with lower domestic demand which had created pressure on the local pellet manufacturers.
Rationale
- PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodologyClick here.
- One deal has been reported so far this week, and has taken into account for price calculation and accorded 50% weightage for T1 trade.
- Fifteen (15) firm offers, bids, and indicative prices were heard. Nine (9) were taken for price calculation and given the balance 50% weightage.
Market highlights
- Raipur pellet offers stable: Godawari Power and Ispat Ltd (GPIL) kept pellet (Fe 63% +/-0.5) offers stable at INR 9,800/t ($118/t) exw-Raipur on 16 February. Offers of other major pellet players in the region remained stable at INR 9,400-9,500/t ($113-114/t) exw.
- P-DRI prices in Raipur stable d-o-d: BigMint’s P-DRI (FeM 80%) prices remained stable d-o-d at INR 26,300/t exw on 16 February. Similarly, the assessment for the sponge in Raipur remained unchanged w-o-w today. Limited trading activity was reported d-o-d, as buyers had already placed enough orders yesterday. So, they came forward for only need-based bookings.
- Billet prices in Raipur down d-o-d: Billet prices in Raipur dipped by INR 150/t d-o-d to INR 39,000/t exw on 16 February. Prices decreased by INR 250/t w-o-w. The index dropped amid transactions recorded at lower prices and buyers were cautious, engaging only in need-based procurement.
Outlook
The pellet market in Raipur is expected to remain under pressure in the coming days amid sluggish sentiments and a cautious approach from buyers. A few buyers are expecting price cuts in the coming days.