Indian Sponge Iron Prices stable at Rs 18,300-20,300/t

• Indian sponge iron prices stable
• Imports of scrap not viable owing to weak Rupee
• Manufacturers are more dependent on sponge iron
• Sponge iron prices should hold firm

Indian sponge iron prices, which had corrected by almost Rs 500/MT last week has shown some resistance this week. Prices are quite stable across India and offers are pertaining in the range of Rs 18,300-20,300/MT (Ex Works). Market sources highlight that trade volumes were high at these levels therefore prices should find support. 

Sponge iron prices which were trading at a low of almost 2 years last month had shown significant jump, after Indian Rupee crashed to 69 levels against USD. Market sources also mention that there is scarcity of imported scrap in the market and most of the furnaces based in western and northern India are consuming more sponge iron.

India is the largest producer of sponge iron in the world with an installed capacity of over 35 MnTA, however with several restriction implied on mining, sponge iron production has been hit hard. According to sponge iron manufacturer's association, production in FY'13 stands at around 18-19 million tonnes.