Despite price cuts by some producers, prices in the local Indian pig iron market have increased by INR 1,000/mt ($15/mt) during the past week to INR 17,300/mt ($261/mt) ex-works, amid all-round buying support and an improved export outlook, traders said on Wednesday, September 7.
“The market has been surprised by the size of the increase in prices. Both the number of transactions and the tonnages involved in transactions have increased over the past week, prompting fresh restocking by dealers who face drawdowns from their stocks,” a Kolkata-based trader said.
“That the price increase came despite a INR 500/mt ($7.5/mt) price cut announced by Rashtriya Ispat Nigam Limited (RINL) for current month deliveries indicates the strong revival in demand for both steel and foundry grade pig iron,” the trader said.
“On the other hand, another producer like Neelachal Ispat Nigam Limited (NINL) hiked its prices by INR 500/mt ($7.5/mt) late last month. However, the divergent pricing of the two producers mentioned is more likely due to their own particular stock positions,” he added.
Market sources said that most large producers are in a buoyant mood after clinching successful export orders and the expected tightness in supplies is providing support for local pig iron prices.
All eyes are on an export tender for 15,000 mt floated by trading firm MMTC Limited on behalf of NINL with September 8 as the last date for submission of bids, the sources said.
The sources also said that reports from pig iron producers indicate that the latter are expected to be successful in shipping out at least 50,000 mt of pig iron in the current month, based on the number of enquiries already received by them.
$1 = INR 66.37