India: Sponge iron prices fluctuate even as demand remains moderate – 1 July

• Trade volumes drop significantly d-o-d
• Pellet prices in Raipur edge lower after NMDC price revision

Indian sponge iron prices showed mixed trends today, increasing by INR 150-400/tonne (t) d-o-d in Durgapur and Ramgarh, while prices in other regions fell by INR 50-200/t.

PDRI prices were assessed at INR 21,400-26,200/t at close of trading, while CDRI tags stood at INR 23,850-28,800/t.

Today, buying activity remained moderate, as sellers held firm to their quoted offers, showing limited willingness to negotiate. Meanwhile, buyers exhibited a cautious approach, opting to purchase only at lower price levels. This led to a balanced market sentiment, with transactions occurring at a moderate pace amid ongoing resistance from both ends.

Transactions of approximately 10,100 t of sponge iron were recorded today compared to 18,450 t on 30 June, Overall, the market remained range-bound, reflecting uncertainty in short-term demand.

Raw material price movements

• Raipur-based pellet producers cut their offers for Fe 62/63% (+/_0.5%) material by INR 300/t ($3.5/t) to INR 8,700-8,800/t ($102-103/t) exw. The drop in prices followed NMDC’s price cut for iron ore and poor sentiments in the sponge iron and semi-finished steel markets.

Ramgarh market overview

The Ramgarh market experienced upward price movement, primarily driven by supply constraints in the neighbouring Durgapur market. A notable shortage of sponge iron in Durgapur led buyers to explore alternate sourcing options, with Ramgarh emerging as a key beneficiary.

The resulting shift in demand provided a price advantage to the Ramgarh market, as limited local inventories aligned with increased buyer interest. This external market influence not only strengthened Ramgarh’s trading sentiment but also contributed to improved realizations for local sellers.”

Rationale

Prices have been derived based on transactions, offers, bids, and indicative price data sets. Transactions are considered as T1 and given a weightage of 50%, whereas other data sets are considered as T2 and given a weightage of the balance 50%.

Click here for detailed methodology