Prices in the local Indian pig iron market have remained stable for the second consecutive week at INR 22,800/mt ($338/mt) ex-works, due to low trading volumes and a slowdown in off-take from the foundry sector for steel grade pig iron, traders said on Wednesday, February 1.
“Foundries have been reducing their capacity utilizations in response to the sluggish export markets for casting and forgings and so they have reduced their pig iron purchases,” a Kolkata-based trader said.
“Most foundries are finding it difficult to pass on the recent surge in pig iron prices to their overseas buyers of castings and forgings and, accordingly, export-oriented units are reducing production,” the trader added.
Market sources state that billet prices have also been softening in response to low demand for long steel products in view of the lack of construction activity.
At least two traders said that pig iron dealers are waiting for pricing signals from producers. They said that prices will continue to remain under pressures and, if producers do not adjust base prices to factor in the fall in volumes, dealers will have no option but to resume discounting in order to manage high-cost inventories.
$1 = INR 67.53