Iron Pellet manufacturers in Odisha are offering the material at lower prices, which are likely to drop further over increase in supply. 

Brahmani River Pellets (Jajpur) has resumed sales at INR 7,300/MT (loaded) and, Bhushan Power & Steel (Jharsuguda) has also pushed its material in domestic market. In Feb, 2014, 4 MnT pa Pellet plant of Jindal Steel & Power (Barbil) might start trial production.

Sources said that Bhushan Power & Steel might finalize its first Pellet export deal in the current week. Jharsuguda based producers are offering Pellets at INR 7,200-7,400/MT (basic). In West Bengal, prices are at 7,500-7,700/MT (basic).

Also, Indian Pellet export market is dull at present. Demand from China has slowed down because of Lunar New Year Holidays from 31 Jan’14-06 Feb’14. Prices are at around USD 162/MT CFR China and demand is likely to pick up mid-February onward. In a weak, Fe 63.5/63 Spot fines prices has dropped by USD 7/MT to USD 125/MT CFR China.

“Domestic demand is good and prevailing prices at INR 7,400-7,500/MT (basic) are quite workable. Exports are on hold presently, we are waiting for Chinese demand to open up, post holidays.  Indian Pellet export offers are at around USD 148/MT FoB Indian east coast; freight rate at around USD 13/MT”, said a Barbil based Pellet maker.

Karnataka Pellet Prices remain High

Karnataka based Pellet makers have raised offers to Fe 7,900-8,100/MT (basic) for Fe 62 material. Lower grade (Fe 60) is being offered at INR 7,200-7,500/MT (basic).

Whereas, Pellet offers are unchanged at INR 8,200/MT (basic) in Raipur (Chhattisgarh) and at INR 7,700/MT (basic) in Tatanagar (Jamshedpur) on decent demand.

Pellet manufacturers in Karnataka told SteelMint, “High Pellet prices have been absorbed by market and cost pressure might push up prices further. We prefer to buy fines of other mines over NMDC’s (3.5-4% alumina) because alumina content of  less than 3% caters to our requirement.

Base price of Fe 63 fines (other mines) were at INR 2,667/MT (basic) in last e-auction. In Q3 FY14, 0.65 MnT Iron ore was purchased by Pellet manufacturers in Karnataka.”