Indian Sponge iron prices held firm on higher freight charges (recent freight hike by Indian Railways) and expected rise in coal prices. Market sources report SteelMint that prices might not correct soon on high cost pressure and low production.
“Freight hike by Indian railways will hit sponge industry hard as transporting iron ore and coal will get dearer by Rs 100-200/t. Also Coal India likely to increase coal prices for (Apr- June) First Quarter.
We do not see any major correction in sponge prices in mid term, said a large sponge manufacturer based in Raipur (Chattisgarh)
Sponge iron prices in Raipur was quoted at Rs.24800-25000/MT, whereas prices in Raigarh were quoted at Rs 24,000-24,100/MT.
However, there was a good news on the grounds of Iron ore supply from Odisha as Essel mining, the largest mine in Joda sector started its operations after 7-8 months. 5-18 mm of 63% Fe for Essel mines was quoted at Rs 7850/MT, which was slightly higher than the market rate.
According to market players, ” It is good sing of improving supply. Even though the prices quoted by Essel mines are premium to the market rates, sponge iron manufacturers would prefer to buy iron ore at these levels as it is cheaper than pellets”.
Note- Sponge prices Ex-Works, Next Day payment condition
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