Indian sponge iron (DRI) exports may increase further in coming months owing to higher global scrap offers and falling demand in domestic market.
Sponge iron exports from India have picked up in Nov’16 by 90% and likely to remain strong in Dec’16. Factors like rising scrap prices in global market and falling demand in domestic market post demonetization will support exports.
Indian exported 27,600 MT of sponge iron in Nov’16 against 14,800 MT in Oct’16. Out of which 99% material was exported to Bangladesh.
Bangladesh is key market for Indian sponge iron. With rising steel making capacities in Bangladesh, sponge iron imports are bound to increase. Although smelters in Bangladesh use only 15-20% of sponge iron in order to maintain carbon percentage.
As per reports, Sponge iron offers to Bangladesh are around USD 240-250/MT CFR Chittagong port and CPT Benapole port (land port), for 80% FeM lumps. Whereas shredded scrap offers are prevailing at above USD 280/MT CFR Chittagong port.
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