Over the past week, prices in the local Indian pig iron market have decreased by INR 600/mt to INR 27,400/mt ($385/mt) ex-works, amid reports that several large producers are going ahead with a mid-month pruning of base prices, a dismal export outlook, and excess supplies flowing into the domestic market, traders said on Wednesday, January 16.
Market sources said that Steel Authority of India Limited (SAIL) has lowered base prices for pig iron supplies from its Bhilai Steel Plant (BSP), but no formal announcement has been made regarding the size of the reduction.
Similarly, Neelachal Ispat Nigam Limited (NINL) is also offering lower negotiated prices based on volume off-take, the sources added.
“The local pig iron market is firmly in a negative zone, primarily because of excess production and falling export shipments. The latest data show that Indian pig iron exports were down 58 percent in 2018 and the trend is unlikely to be reversed in the medium term,” a Kolkata-based trader said.
“The slowdown in demand for castings and forgings, particularly from the automobile manufacturing sector, has triggered a slowdown in foundry capacity utilizations and hence most foundry operators have sharply reduced restocking levels. Also, considerations linked to the end of the fiscal year have also contributed to low fresh bookings,” the trader added.
$1 = INR 71.18