SteelMint Analyst
spoke to Mr. Dutta Gupta, General Manager, Marketing, Dempo, Goa. His analysis
on Indian Pig Iron market is as follows.
“Iron Ore on one
hand is unavailable in sufficient quantity and on the other, is being quoted at
higher prices due to its scarcity. It is being made available at Rs 9,000/MT.
The cost of production of Pig Iron comes to Rs 32,000-32,500
and is a loss for the plant as current offers stand at Rs 28,000/MT. Hence, we
have kept our plant shut which is better than bearing such losses”, quoted
the official.
He mentioned that
Indian Pig Iron markets have shown no improvement for quite some time because
of various reasons such as weak demand from automobile sector, poor
availability of labor, low construction activities, government's time taking
decisions and ban on mining of iron ore in Karnataka.
According to Mr.
Dutta, if the government takes some measures then iron ore can at least be
available through e-auction, provided reasonable prices are quoted. He
personally does not feel that things will resolve before 6 to 8 months. For the
time being, some plants are using scrap in place of Pig Iron. He further
said, Pig Iron exports are not happening as offers in the international market
are not much attractive.
Highlights
of various markets:
Pig Iron market in the country remain on the downside and production cut is also witnessed.
Pig Iron price at NINL is
unchanged but it is offering material at lower price, in the range of Rs
25,200-300/MT on bulk purchases.
In Mandi
Gobindgarh, production capacity is anticipated to come down to 50% and
Industrial power cut issues might start anytime the next week.
Rourkela offers for Steel Grade might come down to
Rs 25,800-900/MT on Friday as buyers are ready to make purchases at these
levels due to liquidity crunch in market.
Sales in Giridih is
low. Sales to Jharkhand of 400-500 tons per day has come down to 2,000 tons in
a month.
Pig Iron plants in
places such as Bhilai, Raigarh,Vizag and Goa, remain shut on limited availability of material.
Market participants feel
market is steady on slow demand and will continue to be on downside in near
term.
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