Indian Pig iron Prices Uptick by INR 200-500/MT

Post increase in Pig iron by Neelachal Ispat this Monday, Indian steel grade Pig iron market witnesses price increase.

Neelachal Ispat Nigam Ltd (NINL), India’s largest state owned merchant Pig iron manufacturer, increased Pig iron prices for the second time in the month of Sept’15. The company has recently increased prices for N1 grade by INR 800/MT to INR 17,800/MT and N2 grade to INR 18,100/MT, ex-Cuttack. Market participants reported to have slight shortage in Pig iron supply in domestic market.

This has led to price rise in Pig iron by INR 200-500/MT across the country. Current offers are at INR 17,800-18,100/MT (ex-Cuttack), INR 19,000-19,200/MT (ex-Raigarh) and 19,600/MT (ex-Raipur) on ex-plant basis excluding excise and other taxes.

Unlike at others, Pig iron prices at Durgapur have witnessed a downfall of around INR 200-300/MT, to INR 18,200-18,300/MT, ex-plants. Downward correction in ingot/billet prices in last few days has led to Pig iron price cut in the state.

Global Pig iron market

Continuous fall in scrap prices in global market is leading to significant fall in Pig iron prices. Offers for Pig iron have touched USD 205/MT FoB Black Sea.

For Indian export offers, manufacturers have unable to fetch bids or close any export tender for a while (3-4 months). Cheaper Chinese billet offers have hit Indian Pig iron exports significantly.

Outlook

Though slight shortage of Pig iron in domestic market has supported Pig iron prices for a decent time period, other related factors are indicating downfall in coming days. Few are mentioned below:

1. Imported shredded scrap offers have corrected by USD 5-10/MT W-o-W, at USD 220-225/MT, (INR 14,300-14,600) CFR India.
2. Met coke offers from China have corrected to USD 140-141/MT, CFR India.
3. Tata Steel has recently sold around 17,000 MT pooled iron (substitute of Pig iron) at INR 16,600-16,650/MT, ex-works.

Steel grade Pig iron prices as on 26 Sept’15

Source: SteelMint Research