In the past week, the local Indian pig iron market has moved in a downward direction for the fifth consecutive week, with prices decreasing by INR 500/mt week on week to INR 22,500/mt ($348/mt) ex-works, amid worsening all-round pessimism, traders said on Wednesday, October 18.
“The pessimism in the market is getting worse by the day due to the softening of domestic finished steel prices, the drying up of export opportunities and the dismal demand outlook in the foundry sector,” a Kolkata-based trader said.
Market sources said that the prolonged bearish conditions in the pig iron market are being led by the negatives in the foundry sector.
Barring a few large foundries catering to the automobile industry, where minimum demand for castings and forgings are assured, most small and medium-scale foundries are languishing from a lack of demand and, with capacity utilizations down to a minimum, they are in no mood to restock raw material,i.e., foundry grade pig iron.
The sources pointed out that there have been no reports of any export tenders from any of the large pig iron producers for almost two months now. Hence, even with producer Neelachal Ispat Nigam Limited’s pig iron dispatches down to almost nil for plant maintenance, the market expects further supply-side pressures on local prices with more volumes arriving, as no export shipments are on the cards, the sources added.
$1 = INR 65.11