- Scrap shortage and higher replacement costs support pig iron demand.
- Full clearance at INR 38,200/t reflects firm buyer acceptance.
SAIL-Bhilai Steel Plant (BSP) conducted a pig iron auction, with the entire offered quantity of 2,470 t booked at an average INR 38,200/t exw, up INR 200/t from the previous auction held on 21 July. In the previous auction, the full 4,940 t quantity was booked at INR 38,000/t exw.
SAIL-BSP auction firms as scrap shortage lifts pig iron appeal
The higher auction price was mainly supported by an acute shortage of melting scrap, which has improved the relative attractiveness of pig iron as an alternative metallic input for steelmakers. A few days earlier, SAIL-BSP’s melting scrap-grade auction reportedly saw prices rise by around INR 3,000–4,000/t from the previous auction, sharply increasing scrap replacement costs and providing support to substitute metallics such as pig iron.
Against this backdrop, buyers were more willing to pay a premium for pig iron, resulting in the INR 200/t increase. The full clearance of the 2,470 t offering, despite a 50% reduction in auction quantity from the previous auction, further reflects firm procurement interest.
While the pig iron increase remained moderate compared with the sharp rise in scrap prices, the auction indicates that higher scrap replacement costs are gradually supporting pricing for alternative metallics, with tight availability and improved steel market sentiment reinforcing the trend.
Leave a Reply