Indian Sponge Iron Prices may Decline

Market participants expect domestic sponge iron prices will fall further on the backdrop of low demand and declining raw material prices.

Indian sponge iron prices may witness some corrections in the coming weeks owing to its sluggish demand. Iron ore lump prices in the market are declining and C-DRI manufacturers expect a further decline in its prices. Sponge prices were corrected by INR 1,000/MT in last one month and any further correction might squeeze the profit margins of the makers.

Currently, C-DRI prices in Durgapur are assessed at INR 15,600/MT (78 FeM), Bellary at INR 14,700/MT (78+ FeM), Raipur at INR 16,900/MT (82+ FeM) and Rourkela at INR 15,000/MT (80 FeM). While, P-DRI in Durgapur is offered at INR 13,600/MT (78 FeM), Bellary at INR 13,800/MT (78+ FeM) and Raipur at INR 14,250/MT (82+ FeM).

Price Gap between C-DRI & P-DRI may Narrow Down

Recently, Odisha based private miners have reduced iron ore lump prices by INR 350/MT, but kept fines prices unchanged. As a result, it is anticipated that price gap between C-DRI & P-DRI will narrow down further as DRI manufacturers prefer iron ore lumps over pellets. Moreover, pellet manufacturers do not have much room for correction as fines prices were unchanged.