Local Indian pig iron prices have decreased by INR 1,100/mt week on week at INR 25,200/mt ($368/mt) ex-work as producers have commenced cuts in base prices and amid negative signals from the poor response to domestic e-auction sales, traders said on Wednesday, July 10.
Market sources said that one of the country’s largest pig iron producers, Neelachal Ispat Nigam Limited (NINL), has slashed its base prices by INR 1,100/mt and other medium-sized producers led by Tata Metaliks are also expected to follow suit over the course of the week ahead.
The sources said that, while a base price adjustment was expected by the market, the size of cut was a surprise and indicates that oversupply of material in the market and high inventories at producers are worse than anticipated.
The source said that negative reports on e-auctions conducted by large producers for domestic sales also indicated low buying interest among end-users, like the case of Steel Authority of India Limited (SAIL) which lowered its base prices at its e-auction but still failed to push the entire volume on offer.
An export tender floated by Rashtriya Ispat Nigam Limited (RINL) cancelled following a poor response in an earlier week and the absence of any new export tender during the past week have undermined market conditions and fuelled apprehensions of more material flowing into the local market, putting further pressures on local prices, the sources added.
$1 = INR 68.57