Neelachal Ispat Nigam Limited (NINL) – India’s largest pig iron producer and supplier in merchant market has extended domestic price circular due date for the 2nd time in a week’s duration. The latest price circular floated is due to expire on 31st Dec’18.
The company had floated fresh offers on 18th Dec’18 with reduction of INR 500-600/MT (USD 7-9) and offered Steel grade at INR 27,900/MT (USD 398), N2 grade at INR 28,500/MT (USD 407) & Foundry (High silicon) grade at INR 29,000/MT (USD 414); ex-Cuttack, East India.
The above offers were expiring on 21st Dec’18, although it was extended till 27th and further extended till 31st Dec’18.
Why has the price circular extension continued ?
As per participants, limited bookings amid public/bank holidays for week long days have forced producer to extend their price circular till the trade activities resume in full-fledged manner.
The stockiest in North India – Ludhiana confirmed nil bookings at current offers by NINL owing to falling prices in the local market. As per their calculations, the landed cost of NINL Steel grade Pig iron is about INR 30,600-30,800/MT FoR Ludhiana. Although trades are happening currently at same prices (INR 30,700-30,800/MT) and there is no clarity, that this range will sustain or come down further over falling scrap prices prices in global market.
Further, West Bengal (Durgapur) based traders also observed limited bookings who were quite active earlier.
However, the bookings through the Central India (Raipur & Raigarh) based stockiest heard close to 20,000-25,000 MT, which is not much healthier, as per industry experts.
It seems if local Billet prices increase further, NINL may receive further bookings, however if this does not happens, the producer may further extend due date or go for price reduction.
Production moved up by 81%
NINL has recorded 81% rise in its production in the July-Sept’18 quarter (Q2) of this fiscal. During this period NINL rolled out 223,000 MT of hot metal and 198,000 MT of pig iron.
The steel company’s September figures was also the best since it commenced commercial operations. NINL produced 75,535 MT of hot metal and 63,550 MT of pig iron in Sept’18.
Leave a Reply