Indian domestic
pig iron prices have showed no material change during the past week, remaining at INR 19,000/mt ($329/mt) ex-works after the previous week's decrease, amid ongoing sluggishness in demand and the lack of export opportunities, traders said on Monday, June 17.
"Demand for foundry grade
pig iron has been at its lowest for a long time since the high grade foundry user segment is languishing," a Kolkata-based trader said, citing the year and a half of contraction in the Indian auto sector.
"The volume of steel grade
pig iron trade, which provided some volumes for traders, is also falling, with monsoon rains spreading across the country and resulting in a slowdown in construction activities," the trader added.
Sources said that there were no reports available in the market of any pending export tenders from large producers for June shipments and this may result in volumes continuing to flow into the domestic market, adding further pressure on prices from the supply side.
The sources said that, according to rough market estimates, traders are carrying about 100,000 metric tons of excess
pig iron stocks and are suffering losses on account of carrying costs, since transaction volumes are for a few thousand tons at best.
Foundries in southern
India have cut down plant utilization rates to around 60 percent, while those in the central region around Raipur are operating at less than half capacity and several traders in these regions are reported to be offering hefty discounts on the base price of INR 19,000/mt with the aim of liquidating stocks and reducing carrying costs, the sources added.