International Pig iron market has not been performing well in the last one month as prices met with a downward trend and enough of stock available with buyers then.
Producers of Pig iron were looking to sell out the maximum possible quantity as prices came down by 10 dollars in Ukraine and Brazil and up to 20 dollars in Russia, which were expected to reduced further.
Demand is weak due to cheaper scrap available and Pig iron had to be less expensive. As a result, producers cut operating capacities.
Ukraine sold its material at low prices i.e. $388/MT FOB to takers in Europe.
Whereas, Russian producers being reluctant to cut prices; buyers have preferred to import direct reduced iron.
Pig iron prices and production capacities of plants look to slide further as scrap is inexpensive and demand for flat products remains dull.
Unlike April to June, July onward, coal and iron ore would be inexpensive and Pig iron input cost would come down.
Price forecast:
In May $380/MT FOB Black and Azov Sea
In June $360-390/MT FOB Black and Azov Sea
In July $360-390/MT FOB Black and Azov Sea
Pig iron market will have a negative impact in May and June, and improve in July, on the following reasons.
Scrap would be cheaper in May and witness a marginal rise in June, the level which will be maintained then.
In July, some further hike is expected as trades in finished will improve and suppliers will be able to provide the required quantity, piled up on poor buying.
In May and June, finished products inventory will be high; demand will improve in July, after construction and engineering sector demand improves.
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