Prices in the local Indian pig iron market have reversed their previous downward movement during the past week, increasing by INR 200/mt to INR 26,200/mt ($407/mt) ex-works, against the backdrop of uncertainties over iron ore supplies and a fall in trading activity, traders said on Wednesday, February 14.
“The downward pressures on prices were reversed and prices edged up largely on the back of uncertainties over iron ore supplies from Goa after mines in the region were directed to close down by March 15,” a Kolkata-based trader said.
“Pig iron prices recovered largely on the back of better sentiment as the impact on supplies of iron ore will be limited to the western region and most large producers in eastern India are unlikely to be impacted as supplies from Odisha, Jharkhand and Chhattisgarh will largely be maintained,” the trader added.
Sources said that there is a slowdown in trading volumes in markets around Raipur and Kolkata in central and eastern regions as current prices are critically poised and could move in either direction and traders are cautious about making fresh bookings.
However, they said that there is a negative bias for pig iron prices, as the closure of the Goa mines will have a limited impact, along with fact that no export tenders are reported in the market this month, leading to possibilities of higher domestic commercial sales by producers.
Uncertainties over pig iron price movements have been accentuated by the divergence of prices across some regional markets with markets around Raipur reporting prices at least INR 1,000/mt ($16/mt) higher for steel grade pig iron and witnessing a sharp fall in volumes compared to markets in the eastern region of India.
$1 = INR 64.17