Local Indian pig iron prices have moved up by INR 500/mt week on week to INR 28,000/mt ($411/mt) ex-works, in reaction to indications that large producers could either maintain their base prices or marginally increase them and also due to the slightly improved response to e-auction sales held during the past week, traders said on Wednesday, June 5.
Market sources said that reports available in the market suggest that e-auction sales conducted by Steel Authority of India Limited (SAIL) have received good responses and the fact that the seller was not forced to lower its reserve prices was taken as a positive indication.
It was also reported that Tata Metaliks had decided to maintain its base prices for June deliveries but a section of the market said that at least few other large producers may marginally hike their base prices based on improved stock movements in the local markets, even though no export tenders were floated during the past week, the sources added.
“Despite the gains in prices during the past week, I would still hold that fundamentals of the pig iron market are still weak. Prices are reacting not to any uptick in demand from key sectors like foundries but in response to producers attempting to nudge up price to offset their rising input costs of iron ore,” a Kolkata-based trader said.
“The lack of any export tender for now over a month will ultimately lead to more material flowing into local markets and putting supply side pressures on prices,” the trader added.
$1 = INR 69.33