State-owned integrated steel-maker Steel Authority of India Ltd (SAIL) continued strong sales momentum at its periodic pig iron auctions in Mar’21, with total sales touching 82,050 t – just a little short of over 84,000 t in Feb’21, SteelMint data shows.
Falling below the 60,000 t mark in Jan’21, sales bounced back in the following months as rising economic momentum led to acceleration in construction and manufacturing activities thereby driving demand for steel.
A majority of the total material allocated for auctions in Mar’21 came from SAIL’s Bokaro and Rourkela steel plants. While 32,700 t was booked from RSP, Bokaro witnessed auctions for over 25,600 t of steel grade pig iron. More than 19,000 t was sold from Bhilai Steel Plant in Chhattisgarh.
As per SteelMint estimates, SAIL has sold over 0.57 mn t of pig iron at successive auctions from its different plants since Jun’20.
Prices firm up
Rising semi-finished steel prices as well as hike in iron ore prices have pushed up prices at SAIL pig iron auctions, SteelMint notes. At RSP’s recent auction for 9,200 t of pig iron conducted on 05 Apr’21, buyers booked the whole quantity at a weighted average price of INR 38,600/t exw. Notably, this was an all-time high so far, recorded by SteelMint. At the previous auction from RSP on 27 Mar’21, the total quantity of 4,000 t had been sold off at a weighted average price of INR 35,450/t.
Similarly, at Bokaro Steel Plant’s auction for 2,850 t of basic grade material on 31 Mar’21, the entire quantity was booked at INR 37,200/t, sources said. The bid price shot up by INR 2,750/t compared with the previous auction on 24 Mar’21 in which 1 rake (2,850 t) had been booked at INR 34,450/t.
SteelMint assesses weighted average pig iron prices from Bhilai Steel Plant at INR 36,050/t in Mar’21 against INR 32,200/t in Feb’21. Similarly, the weighted average price at RSP auctions jumped INR 3,650/t in Mar’21 to INR 35,400/t compared to the previous month. Prices at SAIL’s Bokaro, Burnpur and Durgapur units, too, inched up in the range of INR 3,000-3,500/t (m-o-m) in Mar’21.
As per SteelMint’s assessment, domestic semi-finished steel prices (including sponge iron and billet) rose by INR 1,700-3,300/t across regions in the country in the week ending 3 Apr’21. Steel grade pig iron prices rose by INR 1,000-3,000/t on week across regions as a result of active demand and surge in billet prices.
Record high steel prices in the domestic market and better realisations at auctions are boosting SAIL’s financial prospects at the start of FY22.
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