During week 31, Indian billet offers down by upto INR 600/MT. Major price corrections of INR 500-600/MT were seen in south region. Whereas, sponge offers fluctuated minutely by INR 100-200/MT owing to average trade activities.
Most of the ingot/billet makers in Rourkela, Durgapur and Raigarh have curtailed their production. Raipur, Mumbai and Jalna based manufactures are also planning to follow suit from 1 Aug’16. As per manufacturers, they have reduced production due to heavy loss at current trade prices.
Pig iron offers by most of the suppliers reduced by around INR 500-1,000/MT; rest all are yet in wait & watch mode. Fresh offers will be declared in coming week.
Week 31 dynamics
1. 78-80 FeM C-DRI offers are assessed at INR 11,950/MT (+50) ex-Durgapur, INR 10,750/MT (-100) ex-Rourkela, INR 12,400/MT (+100) ex-Raipur and INR 11,700/MT (0) ex-Bellary. Price changes indicated are weekly.
2. 78-80 FeM P-DRI prices fluctuated to INR 10,350-12,500/MT across major markets.
3. 125×125 mm billet prices are evaluated at INR 19,450/MT (-100) in Durgapur, INR 18,750/MT (-50) in Rourkela, INR 19,750/MT (-200) in Raipur, INR 21,200/MT (-200) in Mumbai, INR 21,60/MT (-600) in Chennai and INR 21,000/MT (-500) in Hyderabad.
4.Indian domestic & global iron ore prices remain firm in the last week. Global iron offers assessed at USD 59/MT, CNF China.
5. Pellet offers stable to INR 2,900-5,150/MT (ex-works) for domestic buyers.
6. Melting scrap offers in both Indian domestic & global market were stable despite sluggish trade activities.
Week 32 outlook
1. Production cut in most of the markets may provide support to Indian ingot/billet prices. While, it may put pressure on sponge prices as demand will decrease significantly.
2. Seasonal less production in iron ore and strong sponge offers may balance Indian iron prices and miners are likely to rollover offers for Aug’16 deliveries.
3. Indian Pig iron manufacturers may come under pressure looking at production cut by ingot/billet makers.
Indian raw material & semis prices as on 30 Jul’16
| Products | Markets | Prices in INR/MT | W-o-W |
| Billet 125*125 MM | ex-Mumbai | 21,200 | – 200 |
| Sponge CDRI 80 FeM | ex-Rourkela | 10,750 | – 100 |
| Sponge PDRI 80 FeM | ex-Raipur | 11,350 | – 100 |
| Pig iron Steel grade | ex-Durgapur | 16,400 | – 250 |
| Scrap HMS (80:20) | ex-Mumbai | 15,550 | – 50 |
| Pellet Fe 63%, 6-20 mm | Barbil, loaded to wagons | 2,900 | -100 |
| Iron ore Fe 62%, 10-30 mm | ex-Mines, Joda | 1,800* | 0 |
Basic prices, all taxes will be applicable
*Incld Royalty, DMF & NMET
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