Since the starting of Aug’16, Pig iron prices in Cuttack and Raipur have been remained almost stable within INR 15,700-15,900/MT and INR 17,100-17,200/MT respectively. However in the month end, Raipur market showed a sharp recovery of INR 1,400/MT to INR 18,500/MT and Cuttack by INR 500/MT to INR 16,400/MT.
In the month of Jul’16, Pig iron prices in Cuttack were hovering within INR 16,700-16,900/MT, which dipped by INR 1,000/MT to INR 15,700/MT in the last week of Jul’16.
Limited supply of material amid rising export and persistent increasing coking coal prices have supported manufacturers to increase their offers. As per the manufacturers, coking coal’s share is 35-40% in cost of Pig iron production.
Taking monthly average, major price correction of INR 750/MT to INR 16,100/MT was seen in Cuttack, followed by Raipur to INR 17,250/MT (-600) and Durgapur to INR 16,600/MT (-200) in Aug’16 against monthly average price of Jul’16.
Key Highlights
1. NINL increased prices by INR 500/MT in Aug’16 post a long duration. However during Apr-Jul’16, the company had reduced prices by approx INR 3,500/MT (USD 52).
2. Indian Pig iron export reached over two-fold in Aug’16 at 54,750 MT; the highest level in the year 2016.
3. Vedanta Resources was the largest exporter with 21,000 MT Pig iron, followed by SAIL at 18,000 MT and MMTC (NINL) at 15,750 MT.
4. Strongest global scrap prices and limited supply of Chinese billet may further increase Indian Pig iron export in Sep’16.
5. After a long gap in Aug’16, NINL started to offer foundry grade (N2) material at INR 16,500/MT ex-works.
Steel Grade Pig Iron Monthly Average Prices since Jan’16
| Month | Durgapur | M-o-M | Raipur | M-o-M | Cuttack | M-o-M | Hyderabad | M-o-M |
| Jan’16 | 16,200 | 900 | 17,500 | 1,250 | 16,200 | 950 | 16,650 | + 150 |
| Feb’16 | 17,150 | + 950 | 18,600 | + 1,100 | 16,750 | + 15,100 | 17,250 | + 600 |
| Mar’16 | 18,550 | + 1,400 | 19,700 | + 1,100 | 17,700 | + 950 | 18,000 | + 750 |
| Apr’16 | 18,800 | + 250 | 20,400 | + 700 | 18,900 | + 1,200 | 19,050 | + 1,050 |
| May’16 | 18,700 | – 100 | 20,950 | + 550 | 19,150 | + 250 | 21,350 | + 2,300 |
| Jun’16 | 17,450 | – 1,250 | 19,600 | – 1,350 | 18,050 | – 1,100 | 19,600 | – 1,750 |
| Jul’16 | 16,800 | – 650 | 17,850 | – 1,750 | 16,850 | – 1,200 | 18,250 | – 1,350 |
| Aug’16 | 16,600 | – 200 | 17,250 | – 600 | 16,100 | – 750 | 18,420 | + 170 |
Basic prices in INR/MT
Sources: SteelMint Research
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