Rastriya Ispat Nigam Limited (RINL), the public sector Pig iron producer had offered 30,000 tons of Basic grade material (Si% 1.0) to overseas buyers on 06 June.
It was a big opportunity as depreciating Rupee – at 59 levels is quite favorable for Indian exporters to finalize any deal.
The tender did not receive any response from international buyers, even after extending the tender opening date by five more days, due to the similar result earlier.
Why Overseas Buyers Chose Not to Participate
Most importantly, weakening price trend in Pig iron across the globe did not interest importers to participate along with difficulties in making any future predictions for the movement in prices in the near future.
Also, looking at falling Rupee, importers decided to avoid taking material at higher exchange rates and instead preferred to hold trading activities at the moment.
The last Pig iron consignment in overseas market is heard to have taken place at 390/MT CFR Korea. Whereas, RINL was anticipating bids at $390/MT FoB Vizag Port and reluctant to accept any response lower to the same.
Domestic Pig Iron Offers look to fall further
RINL's unsold stock position is high for Pig iron presently, at around 60,000 tons, as it has been unable to conclude any export deals recently.
To get rid of the inventory, the producer might cut offers by Rs 500/MT to Rs 21,600/MT (ex works Vizag) for domestic takers in July first week.
New Export Tender might be Floated this Week
RINL is expected to come out with a new 30,000 tons Pig iron export tender in the current week itself and to be opened in the same week.
The present market scenario where Scrap prices have moved up by $5-10/MT in international market, weakening Rupee and as Pig iron prices look to strengthen in July first week by $5/MT that have already moved up by $5/MT to $375/MT FoB Black Sea, gives way to take another chance for winding up of an export deal.
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