July to witness Scarcity of Steel Grade Pig iron in Domestic Market 

Indian domestic market is to witness low supply of Pig iron in the month of July in a major way.

Though, market has had poor supply since mid-March, the situation may worsen.

SteelMint learnt that the state owned manufacturers namely NINL and RINL would be offering less quantity of steel grade material then, which has been detailed below.

1. NINL's Steel Melting Shop (SMS) is anticipated to start operations in full swing, anytime in July.

It is to use about 80% of total Steel grade Pig iron produced, for its SMS.

20% of the material is to be offered to international buyers as NINL uses N1 grade Pig iron to meet with export orders. Rest, depends on the company's decision in terms of better realizations i.e. either from domestic sales or exports.

2. NINL has floated an export tender for 60,000 tons (30,000 tons as an optional lot) of steel grade Pig iron.

Shipment of the material is to take place in July first half (in second half for optional lot), provided the tender is closed on a positive note.
3. RINL has decided to close down operations for one (currently operating 3 in total) of its blast furnace July 13 onward, for a period of four and a half months.

The company would look into repairs and maintenance and improved lining of its 20-22 years old blast furnace, which is currently able to produce 1.7 MnT Pig iron per annum.

With a capacity expansion to 2.2 MnT, when it resumes operations in December, RINL would be able to manufacture more Pig iron.

Secondary Pig iron manufacturers would be at an advantage and lift offers by around Rs 500/MT initially, due to demand (low) and supply (high) mismatch.

Market conditions would later determine the sustainability of prices at new levels as Pig iron supply from Mesco Steel is anticipated to increase in the very next month itself.

Mesco Steel has plans to resume operations from the second blast furnace sized 389 cm3 in August. This would take its production capacity to around 0.5 MnT per annum. The company is manufacturing 0.3 MnT of Pig iron at present, from a single blast furnace.