Indian Sponge iron export market remained active this week. This week, over 5,000 MT sponge C-DRI deals were reported to Bangladesh from the eastern India based suppliers. Also deals were reported for Nepal too. Amid rally in scrap offers globally demand for Indian sponge iron has remained active, shared trade sources.
On an average the deal price for Bangladesh of lumps grade sponge iron assessed at near to USD 269-270/MT CPT Benapole (dry port of India & Bangladesh), which is equivalent to USD 285-288/MT CFR Chittagong, Bangladesh. Few indications were also reported higher by USD 2-3/MT over USD 270/MT, CPT Benapole levels.
Participants believe that amidst significant rally in global scrap prices, the furnaces in Bangladesh are actively booking Indian sponge iron to adjust their input cost as local steel prices in the county remain less supported. Trading was reported average at current offers.
Further, the sponge iron deals for Nepal learned at similar to last week offers of USD 238-240/MT loaded to rake in eastern India. This attracts freight cost of around USD 25/MT for CPT Raxaul/Jogbani border, Nepal.
The local steel demand in Nepal has improved now, following favorable weather for construction activities. Thus, the re-roller in Nepal are also quite active to book Indian billets & wire rod.
Participants believe that, Indian steel prices are less likely to fall on account of supportive demand & high cost base raw materials, which has narrowed down margins (conversion) of standalone mills.
Nepal & Bangladesh are the major buyers of Indian steel produced through the secondary mills in eastern India.
Nepal is the largest buyer of Indian billet & wire rod, whereas Bangladesh considered as major buyer of Indian sponge iron, which imported about 290,130 MT of Indian sponge iron during Jan-Oct’19, surge by 36% Y-o-Y.
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