Local Indian pig iron prices have continued to record major gains for the fourth consecutive week, moving up by INR 600/mt week on week to INR 32,100/mt ($481/mt) ex-works, as there has been little sign of the tight supply situation easing in the market and uncertainties over price changes by large producers during the current month, traders said on Wednesday, May 2.
Traders said that pig iron prices have skyrocketed by INR 4,100/mt ($61/mt) over the past four weeks, one of the strongest bull runs in recent times, largely triggered by supply-side tightness.
According to the traders, there are no firm pricing signals from any of the large producers for current month deliveries, although the market expects a base price push. However, this is contrary to two private pig iron producers deciding to maintain their base prices unchanged and making their announcements early in the month ahead of large producers.
“Even reports of large domestic pig iron producer Neelachal Ispat Nigam Limited completing capital repairs of a blast furnace and being scheduled to fire it over the next few weeks and commence offering of pig iron for commercial sale have failed to ease concerns over supplies,” a Kolkata-based trader said.
“Some large producers like Steel Authority of India Limited are resorting to auction of pig iron to maximize sales revenues compared to negotiated commercial sales, leveraging the short supply of the pig iron in the market,” the trader added.
Market sources said that no new export tenders have been reported during the past week, but the continued surge in local pig iron prices has also been due to expectations of higher overseas shipments later in the month.
$1 = INR 66.69