Indian domestic pig iron prices have slumped INR 700/mt ($11/mt) in the past week to levels around INR 19,000/mt ($312/mt) ex-works, amid subdued market conditions with transaction volumes slumping across regional markets, traders said on Tuesday, August 13.
According to two Kolkata-based traders, pig iron traders have been forced push volumes for transactions even at marginal or negative margins owing to inventory build-up in the eastern and central Indian markets.
The traders said that, even while tepid demand continues in northern India, foundries in the eastern and central markets are being forced to reduce their capacity utilization amid a sharp fall in local demand resulting in low offtake of pig iron.
Market sources said that the Indian pig iron market has been hit with a number of negative factors, including rising raw material (iron ore) costs on the one hand, forcing large producers to refrain from adjusting prices, while at the same time a demand revival is ruled out considering sluggish manufacturing growth across user industries.
No export tenders are reported in the market from any of the large domestic producers, and this is expected to continue to put supply side pressures on prices, several traders told SteelOrbis.