Stability in the local Indian pig iron market has ended during the past week, with prices decreasing by INR 400/mt to INR 28,600/mt ($416/mt) ex-works, since the market has largely ignored successful exports bids and higher e-auction prices on concerns of continued high production, traders said on Wednesday, August 8.
“MMTC Limited reports having successfully concluded an export tender of 15,000 mt and Steel Authority of India Limited (SAIL) has also received bids much higher than the base price as the last round of pig iron e-auctions. But the market has ignored the positives largely because all producers are operating at highest capacity utilizations and over-supply is unlikely to ease in the medium term putting pressures on prices,” a Kolkata based trader said.
Market sources said that discounting persisted in eastern and central Indian regional markets with pig iron quoted at INR 28,500/mt ($415/mt) net of discount.
According to another local trader, the market perceived export shipments volumes to be on the lower side and due to the fact that no new export tenders have been reported during the past week, it will be insufficient to ease pressures on prices from over production and over-supply.
They said that even though large producers like Neelachal Ispat Nigam Limited (NINL) and SAIL has decided to maintain base price for the current month, it is likely that discounting by dealers will widen over the coming weeks and spread to other regional markets owing to high inventories across market intermediaries.
$1 = INR 68.84