Pig Iron prices in Indian domestic market have hit 3 years (36 month) high due to strong exports resulting supply shortage in domestic market and with rising coal & scrap prices globally.
India, is one of the major producer & exporter for pig iron and has an annual production capacity of around 11-12 MnT, out of which 5-7 million tonnes is used by induction and electric arc furnaces and rest being exported by the nation.
The current offers in Indian domestic market for basic (steel) grade pig iron are assessed at INR 25,500-26,000/MT ex-Raipur-Central India, INR 25,000/MT in Durgapur-East region, INR 25,500/MT in Hyderabad-South India & around INR 25,000/MT ex-works in Western India. The similar price range were last reported during August 2014.
Factors that pushed pig iron prices –
Supply Shortage: Supply from the manufacturers end is low due to rise in home consumption and also due to strong export demand which has reduced the availability of material in open market specifically in Central, East, South & Western regions.
Strong exports: Global demand continue to boost for the Indian made pig iron owing to rising global scrap & billet prices in the absence of Chinese cargo.
India’s key pig iron exporters namely, MMTC (on behalf of NINL), Vedanta Resources and RINL (Vizag Steel) are continuously dealing with global buyers.
In CY17 (till Aug 2017), according to data maintained by SteelMint Statistic, India’s bulk pig iron exports moved 4 times at 469,050 MT compared with 109,450 MT corresponding year CY 2016.
In addition, MMTC’s 30,000 tonne export tender is also active which will expire on 13 Sept. Market participants are believe that tender to be settled as participation are strong during last tender.
Rally in Coking coal prices: Coking Coal prices have come under the twin influence of stronger demand and supply which in turn upward momentum in the prices.
Presently, the offers for Premium HCC are hovering at USD 223-225/MT CNF India which were all time low in June 2017 at USD 148-150/MT.
Sharp hike in Scrap & Sponge prices: There is rigorously price hike since couple of months in scrap & sponge iron which are the key substitutes of pig iron. According to SteelMint’s price assessment in these duration, prices for domestic scrap & sponge iron increase by INR 1,000-2,000/MT (USD 15-30).
In the same time imported scrap also moved up by USD 20-30/MT and the fresh offers for HMS (80:20) are evaluated at USD 315-320/MT CNF India.
Leave a Reply