- Sponge iron, billet prices increased by INR 1,000-1,250/t w-o-w
- Market remain cautious on festival
Pellet prices in Raipur rose by INR 200-300/t exw as against 27 February as market participants reported that prices of sponge iron and semi-finished steel producers rose sharply, weighing on overall sentiment in the region. However, the news brought in a total cautiousness in the markets as the participants awaited for further clarity on prices and reassess the situation and refrained from fresh buying.
Trades and price movements
PELLEX, BigMint’s bi-weekly domestic pellet (Fe 63%) index for Raipur, rose by INR 300/t ($3/t) INR 10,800/tonne (t) ($117/t) DAP on 3 March compared to the previous assessment on 27 February. However, no fresh deals were reported at the revised prices.
Raipur-based pellet producers hiked the prices with a strong upward push from semi-finished prices led the Fe 62.5-63% (+/-0.5) grade pellet upto INR 10,600-10,700/t ($115-116/t) exw. Recent volatility in sponge iron and billet prices made buyers cautious, further impacting the trading volume of pellets in Raipur.
Market dynamics
Until last week, the market was firmly positioned for a downward correction, with price softness already visible in eastern India amid weak underlying demand. However, escalating geopolitical tensions abruptly reversed sentiment, injecting significant uncertainty and clouding near-term price visibility.
Most buyers have since shifted to a defensive, wait-and-watch stance, avoiding bulk bookings despite the sharp uptick. Mills are procuring strictly on a need basis, carefully balancing inventories against unpredictable demand conditions.
A billet trader said, “Just a days ago, the consensus was for further softening. Now, the geopolitical flare-up has completely altered the tone, and price direction has become highly uncertain.”
A seller added that the situation has turned unusually complex – while firmness in finished and semi-finished steel has supported the recent uptick. “Clarity will take time, and this volatility is unlikely to ease quickly,” he noted.
Meanwhile, limited spot availability has emerged as some sellers deliberately moderated sales to reassess market trajectory, tightening liquidity and reinforcing the upward pressure on prices.
Rationale
- PELLEX has been derived using data points, i.e., trades, offers, and bids. To download the detailed methodology, click here.
- Zero (0) deals was recorded in this publishing window, and was not taken for calculation. Thus, the T1 trade category was accorded 0% weightage.
- Eleven (11) firm offers, bids, and indicative prices were heard. Ten (10) were taken for price calculation and given balance 100% weightage.
Key market drivers
- Sponge iron prices hike w-o-w: Sponge iron prices rose by INR 900/t ($9/t) w-o-w on 3 March to INR 30,500/t ($330-331/t) exw-Raipur. Prices in Raipur decreased by INR 100/t d-o-d. Participants adopted a cautious stance, awaiting clearer signs of recovery in finished steel offtake before committing to fresh billet bookings.
- Billet prices spikes high w-o-w: BigMint’s billet index increased by INR 1,250/t ($13/t) w-o-w to INR 41,250/t ($447/t) exw-Raipur as against . Market showed a sudden jerk in prices as the news transmitted the market tags and prices declined by INR 250/t d-o-d today. However, buying activity remained limited today at the higher prices, primarily due to the upcoming Holi festival, which has temporarily slowed market participation.
Outlook
Pellet prices in Raipur are expected to remain firm amid geopolitical uncertainty and cautious seller positioning, accompanied by slower trading activity during the Holi week.
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