Indian Pig Iron Prices Remain Range Bound; falling global prices, threat to Indian exporters
Pig iron market is currently experiencing mixed sentiments across the country. Where prices in eastern and southern India have remained unchanged, central India has witnessed marginal fall by INR 100-200/MT this week. Sharp price cut in Pig iron prices in Odisha a week back is said to be the reason for marginal trimming in central India.
Pig iron can be easily sourced to Raipur and Raigarh from plants like SAIL-RSP and NINL based in Odisha at INR 17,500-18,000/MT and INR 17,300-17,500/MT respectively (only freight included) depending upon the quantity booked. Whereas, current offer received by Raipur based Pig iron manufacturer is at INR 18,500/MT and Raigarh is at INR 17,800-900/MT, ex-works.
But contradicting all, Pig iron offers at Durgapur moved up by INR 500-600/MT in a week to INR 17,500-17,700/MT, ex-works . Prices here inched owing to short supply in local market. According to sources, plants at Durgapur are already packed with orders from outside Bengal (like Punjab, U.P, Gujarat) and do not have sufficient quantity to cater to local market.
Meanwhile, prices in Odisha and Vizag market remain range bound at INR 16,500-17,000/MT and INR 18,700/MT, ex-works respectively. Whereas, market in Hyderabad slipped by INR 300-500/MT in a week to INR 19,200-19,300/MT (basic rate). According to a source, large quantity of Pig iron is sourced from Odisha to Hyderabad, which is pulling down the prices.
Global prices drop further
Pig iron offers at CIS nations have touched USD 330-335/MT FoB Black sea. Continous fall in global prices have noticeably hit Indian exports, building pressure on domestic market. Indian Pig iron export which was around 1 MnT in FY 14, fell to 0.6 MnT in FY15.
Outlook
Indian Pig iron and sponge iron manufacturers are under pressure as fall in coal price (USD 3-4/MT) in a week’s time, along with domestic iron ore prices in negatives, has created room for further fall in steel prices.
Domestic Pig Iron Prices as on 29 Jul’15
| Particulars | Prices in INR/MT | W-o-W Change |
| Ex-Cuttack | 16,700 | 0 |
| Ex-Durgapur | 17,500-17,700 | + 400 |
| Ex-Giridih | 17,200 | 0 |
| Ex-Hyderabad | 19,200-19,300 | – 400 |
| Ex-Jharsuguda | 17,000 | – 100 |
| Ludhiana (incld ED) | 22,000-22,500 | – 400 |
| Ex-Raigarh | 17,800-17,900 | – 100 |
| Ex-Raipur | 18,500 | -100 |
| Ex-Rourkela | 16,900 | 0 |
| Ex-Vizag | 18,700 | 0 |
Source: SteelMint Research
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