India: PELLEX falls by INR 50/t amid supply squeeze

• Market awaits OMC iron ore auction outcome
  
  
• Major sellers have opted for maintenance downtimes
  
  

Pellet prices in Raipur remained largely stable this week, though trading activity continued to stay muted. The sluggish sentiment is primarily attributed to the recent decline in sponge iron and semi-finished steel prices, which has kept buyers from aggressively restocking pellets. Market participants noted that most purchases are happening only on a need basis, with minimal bulk deals being reported.

Price movements, trades

PELLEX, BigMint's bi-weekly domestic pellet (Fe63%) index for Raipur, inched down by INR 50/t to INR 10,250/t ($116/t) DAP on 14 October 2025 compared to the previous assessment on 10 October. Around 20,000 t of pellet deals were concluded by the buyers in the last couple of days from Odisha-based pellet suppliers

Raipur-based pellet producers kept their offers for Fe 63/63.5% (+/-0.5%) material stable at INR 10,200-10,300/t ($115-116/t) exw. The prices were stable while buying inquiries were limited.

Some Odisha-based suppliers offered pellets at INR 9,700-10,400/t ($109-117/t) DAP Raipur, with a few deals concluded by Raipur-based buyers.

Market scenario

Currently, only a few local plants are actively offering material in the Raipur market, while several prominent producers continue to keep their operations shut for maintenance. These plants are expected to resume offers only after the Diwali festival.

A trader said, "Market activity is dull, and both offers and buying inquiries are limited. However, a slight shortage in local supply is gradually emerging, which could lend some support to prices if demand revives post-festival."

Some buyers are reportedly sourcing material from Odisha at competitive rates to meet their short-term requirements. A sponge iron manufacturer mentioned, "Odisha-origin pellets are currently more viable due to better price parity. Local offers are limited, so we are procuring only what is necessary."

Meanwhile, market attention is now turning toward the upcoming Odisha Mining Corporation (OMC) iron ore auction, scheduled for 17 October, and is expected to influence market direction in the near term. If auction prices soften, participants anticipate some downward correction in pellet prices as well.

Market sources believe that volatility may persist in the coming weeks as buyers wait for clarity from both the OMC auction and post-Diwali production resumption. "The overall sentiment remains cautious, but any supply constraints after Diwali could turn the market dynamics, another participant added.

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 was not taken for calculation. Thus, the T1 trade category was accorded 0% weightage.
  
  
• Twenty-one (21) firm offers, bids, and indicative prices were heard. Fifteen (15) were taken for price calculation and given a balance of 100% weightage.
  
  

Key market drivers

• Sponge iron tags down w-o-w: P-DRI prices declined by INR 350/t ($4/t) w-o-w to INR 23,000/t ($259/t) exw-Raipur on 14 October while falling by INR 100/t ($1/t) d-o-d. Most trades were concluded at lower levels, reflecting cautious buyer sentiment, while producers refrained from steep price cuts despite continued selling pressure across key producing regions.
  
  
• Billet prices drop w-o-w: Billet prices in Raipur decreased by INR 600/t ($7/t) w-o-w to INR 34,900/t ($393/t) exw today. Prices fell by INR 250/t ($3/t) d-o-d. With lack of inquiries, sellers were pressured to cut prices and conclude deals at lower levels. However, no major movement was seen. Market sentiment remained bearish and dull, with only need-based buying and limited activity within a narrow price range.
  
  

Outlook

The Raipur pellet market remains stable yet uncertain, awaiting fresh cues from the raw material side.