The three-week stability in the local Indian pig iron market has ended during the past week with prices declining by a significant INR 900/mt ($13/mt) to INR 15,800/mt ($237/mt) ex-works, reacting to price cuts by large producers and excess supplies, traders said on Wednesday, August 3.
Market sources said that Neelachal Ispat Nigam Limited (NINL), one of the largest Indian pig iron producers, slashed prices by INR 1,000/mt ($15/mt) for August deliveries, while Rashtriya Ispat Nigam Limited (RINL) is expected to do so too over the next few days.
“There is just too much supply flowing into the market from producers, while there is no appetite among buyers, particularly from the foundry sector,” a Kolkata-based trader said.
“Inventories have piled up at both producers and traders, forcing the former to adjust base prices, but this has failed to show any significant salutary impact on market volumes,” the trader added.
Market sources pointed out that pig iron prices have also reacted to the softening of billet prices which are down by about two percent over the past week on average across the different regions in India.
Demand for steel grade pig iron has also been impacted by the slowdown in off-take of long products amid the current monsoon season and slower construction activities, the sources said.