- NMDC’s iron ore price hike supported spot offers;
- Bookings improve despite subdued finished steel demand
India’s sponge iron market opened the month of August with a modest upward price movement, as spot offers increased by INR 50-150/tonne across major producing regions. The Bellary region, however, witnessed a price dip of INR 100/t in lumps-based DRI, owing to regional oversupply and limited demand.
This price uptick was primarily due to a recent hike of INR 450/t in iron ore prices by NMDC, which has escalated sponge iron production costs. In response, manufacturers adopted a firmer pricing stance, even as demand from the finished steel segment remained weak.
Despite the price increase, buying interest remained moderate, with many buyers opting for a wait-and-watch approach after having already procured material in previous sessions. Still, trade activity picked up noticeably, with an estimated 25,000 tonnes of sponge iron booked across regions-a significant rise compared to the previous session.
Market sentiment remains cautiously optimistic, with participants closely monitoring further movements in raw material prices and regional supply-demand dynamics.
Rationale
Prices have been derived based on transactions, offers, bids, and indicative price data sets. Transactions are considered as T1 and given a weightage of 50%, whereas other data sets are considered as T2 and given a weightage of the balance 50%.
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