India: Semi Finish Market remain Standstill over Cautious Buying

Liquidity problem due to end of financial year, upcoming general elections, low finish sales and power cut in major Mandi’s are the factors for which market participants believe that prices will be maintained.

Manufacturers based in Raipur (Central India) stated that sales volume of MS Ingot/Billet is not encouraging as buying from major buyers is limited in anticipation of price correction in the future. Similarly, buying from Mumbai & Ghaziabad is heard to be at limited level.

Power Cut may hike Prices- Market Players

SteelMint in discussion with MS Ingot & Re-bar manufacturers assessed that in coming weeks market may shot up by nearly INR 500/MT on rumor of power cut. In summer season, demand of finished steel products is low, although power issue supports the prices, they added further.

Similarly, power cut in Hyderabad from past 20 days has increased Ingot/Billet & Re-bar prices. However, Sponge pellet offers declined by INR 200-300/MT in a week’s time due to power cut. Manufacturers are of the view that the power cut is likely to increase to 1-2 days from 1^st April which at present is weekly one day.

Sponge Iron: High Pellet production has started impacting the Sponge iron production as production of Sponge pellet overtakes the Sponge iron production in Raipur & Durgapur. Gap in selling prices of Sponge pellet & Sponge iron have widened by INR 200-300/MT. In Raipur, Sponge pellet is offered at INR 19,400/MT, while Sponge iron stood at INR 21,000/MT which is at higher side widening difference to INR 1,600/MT from previous prices i.e. INR 1,300-1,400/MT.

In contrary, MS Ingot manufacturers are of the opinion that MS Ingot/Billet market will remain standstill or expected to increase over high Sponge iron prices and power cut issue in Apr’14.

Sponge Iron Buyers look for Alternative

SteelMint on speaking to manufacturers based in Raipur & Jalna have found that viability of Sponge iron from Rourkela to Raipur/Raigarh and Raipur to Mumbai/Jalna has improved from the past few days.

• Sponge iron (FeM 78) from Rourkela is being sold at INR 20,300/MT delivered Raipur, whereas local sellers are offering (FeM 79) material at INR 21,100/MT Ex-plant.
• Raipur is selling Sponge iron (FeM 79) to Jalna at INR 23,000/MT FoR. On the other side, if material is sold to Jalna from Bellary (FeM 75), it will be offered at INR 21,300/MT.

Freight Charges by Road from Rourkela to nearby Markets