Prices in the local Indian pig iron market have remained stable during the last week at INR 21,300/mt ($320/mt) ex-works, as the market mood has become cautious due to the uncertainties over the short-term trend, traders said on Wednesday, November 9.
“The market is still waiting for large producers to announce their base prices for the current month. The mood is cautious since most market participants are expecting resistance to any further price increase,” a Kolkata-based trader said.
“Pig iron prices have moved up too fast over the past months by about INR 1,500/mt ($23/mt) and this clearly far exceeds the demand uptick” the trader added.
At least two traders pointed out that, even if large producers come out with revised base prices over the next few days, a correction cannot be discounted as most market participants will reduce fresh bookings sharply and market activity will slacken.
While there has been no official confirmation, market reports said that Rashtriya Ispat Nigam Limited has increased prices marginally by INR 200/mt ($3/mt) and others are likely to follow suit over the next few days.
However, market sources said that even the marginal adjustment will impact trade volumes since dealers will not be able to pass on the increase to user industries and, on the contrary, will have to offer discounts to keep pushing volumes and control their already-high stock positions.
$1 = INR 66.46