** Indian domestic pig iron prices hit 6-yrs high on supply issues
** No export offers or deals reported
Indian Pig iron prices continue to rally on supply issues rather than demand factor, SteelMint learned from market sources. Current prices are hovering at 6-years high as two major plants Neelachal Ispat Nigam Ltd (NINL) and Vedanta Resources are literally out of market. Combined production capacity of both the plants is around 1.2- 1.3 million tonnes.
NINL is undergoing capital repair maintenance (which is delayed by a month) and Vedanta is struggling with iron ore sourcing, post Supreme court order to shut all iron ore mines in Goa (Vedanata use to source 80% of its iron ore from its Goa mines).
Current Offers
Current offers for steel grade are hovering at INR 29,500-30,000/MT (USD 453-460) ex-Durgapur/Odisha – East India, INR 30,500-31,000/MT (USD 469-476) ex-Raipur – Central India, INR 28,500-29,000/MT delivered Hyderabad & INR 31,000-31,500/MT delivered Ludhiana, excluding GST. These levels high since Jan 2012.
Factors Supporting Prices
1. Low supply of steel grade pig iron
2. Limited availability of granulated pig iron and pooled iron from Jindal Steel and Tata Steel amid increased captive consumption
3. Rising coking coal and scrap prices. Both commodities have seen an upside of about USD 20-25/MT in last few weeks
4. Indian domestic billet prices have recovered by around INR 2,000-3,000/MT (USD 30-45) in last one month
No Export Offers from Indian Manufacturers
Indian pig iron exporters keep themselves out of the global market on limited supply and better domestic realizations. However, market participants expect prices should not be less than USD 385-390/MT FOB India. India exported around 0.58 MnT Pig iron in 2017 as against 0.17 MnT in 2016, according to data maintained by SteelMint stats.
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