Indian pig iron prices dip as producers cut prices, export activity poor

Indian pig iron prices have dipped this week to INR 24,000/mt ($434/mt) ex-works, in line with the INR 500/mt ($9/mt) price cut announced by Neelachal Ispat Nigam Limited (NINL), one of the largest domestic producers, traders said on Thursday, August 23.
 
"NINL has cut prices twice over the last 30 days and, coupled with oversupply, market prices weakened," a Kolkata-based trader said.
 
"There is no sanctity of the official quoted price of producers. Prices are being finalized in negotiations between large buyers and producers with sops thrown in by way of volume discounts or free transportation since producers' priority is to bring down inventories," he added.
 
"Steel grade pig iron prices at Durgapur have decreased by INR 200/mt ($4/mt) from lack of volume offtake," a foundry operator in Kolkata said.
 
The town of Durgapur, 160 km from Kolkata, is the location of a number of large and medium-scale pig iron producers like Durgapur Steel Plant of Steel Authority of India Limited (SAIL), Jai Balaji Group, Kajaria Metallics Limited and SPS Group.
 
India's pig iron production in July totaled 524,000 mt, decreasing slightly by 0.2 percent month on month, but this decline was too small to impact domestic prices. In contrast, Chinese pig iron production in July was reported at 56 million mt, up 6 million mt, exerting a negative impact on the Indian export markets, an official at SAIL said.
 
NINL pig iron export offers are still open at $475/mt FOB. However, since international offers are not above $415/mt levels, the export deals anticipated in August have not materialized so far, a trader said.