- No aggressive bidding amid adequate inventories
- Elevated input costs provide a floor to prices
Domestic sponge iron prices showed mixed movements today, with prices declining by around INR 50-200/t in Mandi and Durgapur, while Raigarh and Rourkela witnessed gains of around INR 200-300/t. Prices across other major regional markets remained largely stable amid balanced availability and cautious trading activity.
Sellers held firm offers, with limited willingness to reduce prices. Producers with advance bookings remained focused on dispatching committed volumes, while buyers had adequate inventories and showed limited interest in aggressive bidding.
Overall, fresh enquiries and demand remained subdued, with purchases largely restricted to immediate requirements. However, elevated raw material costs continued to put pressure on producer margins, providing underlying support to prevailing sponge iron offers.
A Jharkhand-based source said he was incurring conversion losses of around INR 500-1,000/t while converting sponge iron into billets. The producer added that conversion margins of around INR 14,500/t remained insufficient against elevated raw material costs.
A Raigarh-based producer said high pellet and coal prices were resulting in losses even at the sponge iron manufacturing stage, further limiting producers’ ability to lower offers.
Overall, the market remained balanced but cautious, with weak fresh buying limiting trade activity while elevated input costs continued to provide a floor to sponge iron prices. BigMint recorded trade volume of around 11,000 t today, compared with 22,000 t on the previous working day.
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%.
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