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India: Dull Demand Keeps Domestic Pig Iron Offers Under Pressure

Weakening demand of finished products has lowered furnaces margins (conversion spread) which in turn has weakened buying interest of pig iron in Indian domestic market.

Notably, the price gap (conversion) between pig iron & billet has narrowed down significantly and is currently evaluated at INR 3,000-3,500/MT (USD 42-50) in Raipur & Durgapur, which should be not less than of INR 4,000/MT (USD 57), as per ingot/billet manufacturers.

Pig iron is the key ingredient to make ingot/billet from sponge iron route. However currently the pig iron industry is subdued due to sluggish demand.

The private pig iron producers in Eastern India continued lowering their offers and have reduced by about INR 1,000/MT (USD 14) in last couple of weeks and currently offers steel grade material at INR 27,800-28,200/MT ex-Durgapur, INR 27,500-28,000/MT ex-Jharkhand & INR 27,000-27,200/MT ex-Jajpur, Odisha.

Remarkably, recent pig iron auction held on 8th May by SAIL was also unable to attract buyers as offered quantity of 12,600 MT, nearly entire material remain unsold at the base price of INR 27,500/MT ex-plant, Rourkela, eastern India.

However  the private mills stated,  further price movement is depend on NINL fresh price circular which is due since 8th May'19 and the last offers by the company was at INR 27,000-27,400/MT ex-plant, Cuttack, Odisha.

Coming to Central region where stockiest have sufficient stock in hand and have maintained offers after a fall of INR 300-500/MT during start of May'19. Current offers in Central region, Raipur & Raigarh is reported at INR 28,200-28,300/MT FoR & excluding GST.

In line Northern India, the traders have booked about 4 rakes (equivalent to 8,800 MT) pig iron from NINL at the price of INR 27,000-27,400/MT (ex-plant), for which dispatches are to be made during May-Jun'19. The price range of steel grade pig iron assessed at INR 30,300-30,800/MT & foundry grade at INR 34,300-34,600/MT FoR Ludhiana & excluding GST.

News No: 4521
Date: 2019/05/14 - 19:36
News Source: SteelMint

India  Pig Iron  billet  sponge iron 

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