The local Indian pig iron market has showed signs of cooling off with prices edging down marginally by INR 100/mt during the past week to INR 32,000/mt ($476/mt) ex-works, with producers likely to maintain their base prices unchanged for the current month and also due to the fall in restocking interest from market intermediaries, traders said on Wednesday, May 9.
Market sources said that, while Neelachal Ispat Nigam Limited (NINL) which has resumed production during the past week after capital repairs of its blast furnace is reported to have reduced its pig iron prices by INR 200/mt, other major Indian producers are largely expected to keep their base prices stable for May deliveries.
However, two other traders differed claiming that the preference of producers like Steel Authority of India Limited for the auction route - as opposed to negotiated commercial sales - in order to secure higher prices is an indication that current demand has left headroom for base price revisions and so such a base price hike cannot be ruled out later in the month.
“After four consecutive weeks of rises, the domestic pig iron market is seen to be taking a pause. Dealers having aggressively restocked in earlier weeks are taking a break from building up high-cost inventories, prompting a marginal correction in prices,” a Kolkata-based trader said.
“However, the outlook for pig iron has continued to be bullish and the correction is possibly just a minor blip. Tight supplies from producers persist in the market and this will enable prices to recover their minor losses in the short term,” the trader added.
$1 = INR 67.27