Local Indian pig iron prices have edged down by INR 700/mt during the past week to INR 30,000/mt ($413/mt) ex-works amid mixed signals and wider regional disparity even as the market anticipated a base price hike by producers for October deliveries, traders said on Wednesday, September 26.
“There is no direction in the market and regional price disparities are widening even though the market is expecting major producers to increase their base prices next month,” a Kolkata-based trader said.
“Buyers are confused by mixed signals and prefer to stay on the sideline till they are sure of the short term trend,” the trader added.
Market sources state that while pig iron prices in eastern India are offered at around INR 29,800/mt ($410/mt) ex-works, net of discount, pig iron offers in western India are commanding an approximate premium of INR 200/mt.
The sources said that part of the disparity can be explained by the difference in availability and the supply volumes in the local markets in question, while most market intermediaries are confused by the reports that some of the large producers including Steel Authority of India Limited (SAIL) prefer to focus on domestic sales instead of exports.
This is difficult to explain considering that export realizations are being supported by the depreciation of the Indian rupee, which is poised to breach the INR 73 to a dollar mark, the sources added.
$1 = INR 72.65