Pig Iron Market Update: Prices In Eastern India Unlikely To Surge Further

Recently, the Steel Grade Pig Iron market in eastern India’s Durgapur region has seen a price increase, but participants suggest that a further surge is less likely as the supply is expected to improve. One of the major Pig Iron suppliers in the Durgapur spot market has resumed operations after facing a week-long shutdown due to technical issues in its furnace. This development is expected to alleviate some of the supply constraints in the market.

Contributing Factors

These factors indicate that the Pig Iron market may not experience significant price surges in the near future:

• Average Demand- Pig Iron’s domestic demand is relatively average, with producers receiving few orders, as assessed by OfBusiness from Durgapur-based plants.

• Coking Coal Price- The price of premium Coking Coal from Australia is currently hovering at $245/ton CFR India, experiencing a $10/ton increase week-on-week but a $15/ton drop month-on-month.

• Export Demand and Steel Demand- Paused exports and subdued domestic Steel demand globally have dampened participants’ hopes for further support in the industry.

Price Movement

While the Pig Iron market in eastern India’s Durgapur region may not witness a significant price increase, other markets across the country have seen volatile movements. In the northern and western regions, prices have remained volatile. However, in the central region’s Raipur market, prices have gained by Rs 500-700/ton week-on-week. This increase can be attributed to the surge in billet prices, which rose by Rs 1,000/ton during the same period.

Current Prices

• Steel Grade Pig Iron
  • The latest offers are reported to be around:
  • Durgapur- Rs 42,500-42,700/ton ex-works in eastern India. This reflects a surge of Rs 800/ton compared to prices on 1 June 2023.
  • Raipur- Prices have risen by Rs 500-700/ton week-on-week, reaching Rs 41,500-41,700/ton.
  • Ludhiana- Prices have remained stable at around Rs 43,800-44,000/ton.

• Foundry Grade Pig Iron
  • Foundry-grade Pig Iron prices have experienced fluctuations due to subdued domestic demand and poor exports. Major Foundry-grade Pig Iron producers from western India have maintained their prices amidst these market conditions.

• The current offers are reported at:
  • Ludhiana- Rs 45,300-45,500/ton
  • Delhi- Rs 45,500-45,800/ton
  • Ahmedabad- Rs 46,500-47,000/ton
  • Note- The prices are on a delivered basis.

OFB’s Insight

Due to fluctuating Coal prices, stable Iron Ore prices, and subdued Steel demand globally, surges are less likely to happen in Durgapur’s Steel Grade Pig Iron market. Other markets across India have experienced varying price movements, with the central region’s Raipur market witnessing gains.

Read more: India’s Pellet Export To China Drops Over 50% In May 2023

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