Sponge iron manufacturers have increased offer by INR 300-500/MT witnessing raw material (Iron ore) shortage in coming days owing to the Supreme Court’s order for suspension of 26 mines.
“At present scenario, Iron ore shortage has not seen in the market but if issue will not resolve, we may see the dry condition in coming 15-20 days. There are only few Iron pellet sellers and that preferred to booked the material in advance,” said a Sponge manufacturer based in Durgapur.
Sponge prices in Durgapur, the biggest supplier of MS Ingot/Billet to North India, have increased by INR 400-600/MT; freight cost to Punjab is at INR 2,400-2,600/MT. Similarly, Pig iron prices have increased by INR 1,500/MT to INR 26,000/MT Ex-Works. In contrary, demand from finish Long market remains weak in major city as stockiest hold negative sentiment.
Sponge prices in Chhattisgarh remain stable as market participants anticipate that the Supreme Court’s order will get the stay by primary manufacturers and if not, the manufacturers have an NMDC option to buy the material.
MS Ingot prices have mixed sentiment – Scrap based market prices remain low and Sponge based market offers remain high.
North India prices remain bearish due to oversupply of MS Ingot & Billet. Brokers have a negative sentiment and don’t expect prices to increase in near term. Whereas, Sponge commission agent has raised prices by INR 500/MT as origin price increased.
“MS Ingot manufacturers are not serious about the current issue. They will react for this but late,” said Sponge Stockiest who deals with Rourkela’s Sponge based in Mandi.
MS Ingot offers in Hyderabad have increased by INR 500/MT on rumor of the news that Andhra Pradesh government may increase power tariff any time soon. However, we don’t have any confirmation.
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