India: NINL likely to revise Pig Iron Prices on October 01 

Neelachal Ispat Nigam Limited (NINL), India's largest Pig iron producer since 2004-05 and rice setter of Indian Pig iron industry, might revise prices of its material on October 01.

Current Stock Position 

The current inventory position of NINL's Pig iron is on the lower side. Only about 15,000 tonnes of Steel/N1 grade material is available presently.

Stock of Steel/N2 grade is quite low and foundry/N3 grade Pig iron is not available.

NINL's current Pig iron prices 

Grade Si%             Price (INR/MT)

N1     Up to 1.24   23,500

N2     1.25-1.79    24,000

(Basic Prices; Ex NINL Plant basis)

Expected Price Trend of NINL's Pig Iron in October 

SteelMint thinks that NINL's domestic Pig iron offers do not have any scope for an upward movement.

The company is unable to get rid of its material in large quantities at prevailing price level.

NINL might introduce discount of INR 400-500/MT for purchases of the material in big quantities or cut prices to encourage domestic sales.

The company has recently closed an export deal for 30,000 tonnes of Pig iron at prices close to its domestic offers.

It might offer the additional 30,000 tonnes through a new tender in the month of October.

Why NINL's Pig iron production came down in last 3 years?

Campaign Life of Blast Furnace Needs to be Increased

NINL, with an installed capacity of 0.85 MnT pa, produces Pig iron from a single blast furnace.

It was commissioned about 11-12 years back and requires repairs and maintenance in order to enhance its efficiency.

Issues around Raw material procurement

The Pig iron manufacturer procures Iron ore from miners such as OMC, NMDC and private mines in Odisha.

Iron ore availability in limited quantities and at high prices, have impacted the production level.

Total Capacity Utilization of BF

Since 2004-05, NINL has utilized only 57-77% of its total installed capacity for manufacturing Pig iron.

The blast furnace has produced about 4.9 MnT pa of the material which includes 57% of sales to export market.

Apart from domestic sales, about 20-30% of the total Pig iron production is being used in Steel making and NINL is also a consistent exporter of its material.