Local Indian pig iron prices have remained stable for the second consecutive week at around INR 16,500/mt ($244/mt) ex-works, while dealers refrained from passing on higher base prices from producers owing to slow market activity, traders said on Wednesday, January 20.
“Even though large producers increased their prices early in the month, dealers have not passed on higher prices to end-users. This might be because they have been liquidating old stocks to keep volumes moving,” a Kolkata-based trader said.
“The market is uncertain whether producers will be able to sustain their price hikes and there are expectations of a rollback next month, considering apprehensions of oversupply being exacerbated in the medium term,” the trader added.
Market sources said that Indian pig iron exports declined by a massive 40 percent in 2015 to 450,500 mt, and, with producers not likely to cut back production, excess supplies will continue to maintain downward pressures on local prices.
The sources said that the negative outlook for pig iron exports is reinforced by the fact that neither Neelachal Ispat Nigam Limited (NINL) nor Rashtriya Ispat Nigam Limited (RINL) were successful in securing transactions in the exports tenders for 30,000 mt each respectively floated over the last two months.