Over the past week, prices in the local Indian pig iron market have showed mixed trends, with most prices moving down by INR 700/mt to INR 28,000/mt ($397/mt) ex-works, while in a few regions prices have decreased by INR 900/mt in total to INR 27,800/mt ($396/mt) as a result of INR 200/mt of additional discounts, traders said on Wednesday, January 9.
Sources said that there are no definite pricing signals from large pig iron producers, with one large producer reducing its base price by INR 500/mt, but other producers are yet to announce prices for current month deliveries and so confusion has prevailed among market participants.
The sources said that, while supply-side pressures have persisted with all large producers reporting higher December production, while dealers in select markets like Raigarh in central India are reported to be offering discounts of about INR 200/mt, reducing their prices to INR 27,800/mt ($396/mt) in order to keep pushing volumes into the market.
“The undertone of the market is negative considering that all producers are producing at maximum capacity. Weak billet prices are also ensuring that producers are pushing more pig iron volumes through commercial sales as opposed to captive consumption and this will continue to keep prices under pressure,” a Kolkata-based trader said.
“Even though most producers have deferred announcing base prices for the current month, dealers have cut back on fresh bookings as a price adjustment is inevitable as holding the base price line under current market conditions does not seem feasible,” the trader added.