- Pellet producers in Raipur reduce offers by INR 600/t
- Bid-offers disparity seen in market amid subdued steel prices
- Deals remain sluggish ahead of Diwali festival
PELLEX falls prices in Raipur fell this week, as local suppliers and those in Odisha reduced their offers. However, the decline in prices failed to elicit any active response from buyers. Purchasing activity has largely stalled due to the ongoing festive season and weak market sentiment in the sponge iron and semi-finished steel segments.
BigMint’s bi-weekly domestic pellet (Fe63%) index fell by INR 500/t ($6/t) to INR 10,000/t ($119/t) DAP Raipur on 29 October compared to the previous assessment on 25 October. Raipur-based sellers concluded a 5,000-10,000 t pellet deal at INR 9,800-9,900/t ($117-118/t) exw at lowered offers in this publishing window.
Some producers from Odisha offered pellets (Fe62.5-63%) at INR 9,600-10,000/t ($114-119/t) DAP to buyers in Raipur, but no deals were struck due to differences in bids and offers.
Market participants reported a noticeable gap between bids and offers, which led to the absence of pellet deals. Steelmakers remained cautious, showing no interest in procuring material amid fluctuating prices and an overall downtrend in the steel industry.
“Pellet prices have declined, but buying interest remains low. The market is waiting for stability in the steel segment. Some steelmakers are optimistic that trading activity may pick up post-Diwali, as buyers look to restock after the holiday season,” a market participant said.
P-DRI prices dropped by INR 350/t ($4/t) w-o-w to INR 26,100/t ($311/t) exw-Raipur on 29 October. Meanwhile, prices fell by INR 200/t ($2.5/t) d-o-d. Furthermore, billet tags in Raipur decreased by INR 350 ($4/t) w-o-w to INR 39,250/t ($467/t) exw and dropped by INR 150/t ($2/t) d-o-d.
Pellet offers drop in Raipur: Raipur-based pellet makers reduced iron ore Fe63% (+/_0.5%) offers on 28 October by INR 600/t ($7/t) to INR 9,800-9,900/t ($117-118/t) exw amid the continuous drop in sponge and semi-finished steel prices. Godawari Power and Ispat (GPIL) reduced Fe63.5% and Fe65.5% pellet offers by INR 600/t ($7/t) to INR 10,400/t ($124/t) and INR 11,600/t ($138/t) exw.
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 in this publishing window and taken into account for price calculation and accorded a 50% weightage for T1 trade.
- Twenty-one (21) firm offers, bids, and indicative prices were heard. Fifteen (15) were taken for price calculation and given the balance 50% weightage.
Outlook
Pellet prices in Raipur are expected to remain volatile during the festive break. Deals may remain conspicuous by their absence this week amid weak buying interest from steelmakers and the downtrend in sponge iron and steel prices.
Article Credit: Bigmint
