India: Odisha sponge iron prices under pressure as furnaces curb production

Around 12 to 15 Odisha-based furnaces producing steel ingots and billets have curtailed production since the midnight of 30 Jun’21, as per sources. Overall production loss is reported at 800-1,000 tonnes/per day equivalent to 25,000-30,000 t on a monthly basis. This has put further pressure on sponge iron prices as fresh purchases by the remaining plants are on hold with expectations of further drop in prices.

• The conversion spread from C-DRI to billet in Rourkela is at INR 9,500-10,000/t, down INR 2,500/t as against May.
• Margins fell as billet prices dropped by INR 3,000/t in a month whereas sponge iron prices declined by around INR 2,000/t.