In Karnataka, South India, sponge prices have declined by INR 800-1,200/MT (USD 12-18) in a week, limited inquiries resulting continues price fall in the market.
According to state based producers, sponge iron inquiries are minimal over sharp fall in billet prices on poor demand for long steel products. This has forced producers to reduce prices in line to fetch bookings.
SteelMint’s assessment for 78-80 FeM coal based Sponge C-DRI (Bellary) are reported at INR 20,500-20,700/MT (USD 322-326) which have fell by INR 1,200/MT compared with last week assessment at INR 21,900-22,100/MT (USD 344-348) ex-plant.
— BMM Ispat, the major sponge producer in the region, having sponge iron production capacity of 2,300 TPD (0.7 MnT pa). The company is offering FeM 80 P-DRI lump at INR 20,000/MT ex-plant, offers decline by around INR 1,000/MT W-o-W.
— Another renowned manufacturer in the state namely BIOP Steel who makes prime grade material (high metalization) is offering C-DRI lumps – FeM 80 at INR 20,900/MT & FeM 82 at INR 21,300/MT ex-plant, offers decline by around INR 500/MT D-o-D.
Karnataka is the third largest sponge iron producing state in India which contributes about 9-10% in country’s total DRI production. The sponge iron produced in the state are largely sell to Western India – Maharashtra, Gujarat & Rajasthan and in the surrounding states including local market.
Offers in other major markets also decline in the range of INR 500-1,200/MT (USD 8-18). According to SteelMint assessment, in Central India-Raipur sponge prices down by INR 800-1,200/MT & in East region – Durgapur & Rourkela it fell by INR 500-800/MT in a week duration.
The small sponge producers in these regions have mentioned that, prices have less scope for major fall as inquiries are picked gradually. Also, they feel that the current prices are bottomed out looking at high raw material cost.
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