Indian Pig Iron Market Turns Optimistic In FY24

The Pig Iron market in India has turned optimistic in FY24 after a constant drop in the last quarter (Q4) of FY23 by around Rs 5,000/ton ($60). The price surge is attributed to an improvement in demand and an active response from domestic Steel mills, which has led to an increase in Pig Iron prices in the first week of FY24.

Reasons For The Price Rise

The increase in Pig Iron prices in India has been primarily driven by a surge in demand due to dry stock with both traders and smelters (Ingot, billet manufacturers) end. This has led to active inquiries and the suppliers have been able to raise their prices consistently, Ofbusiness observed in conversations with industry participants.

Additionally, with limited scope for a downtrend in Steel prices of mid-sized Steel mills, demand has remained active, leading to active trades in the market. Finally, a minor change in Steel prices through primary Steel makers has resulted in the assumption that Pig Iron prices were also the bottom line, leading to buyers actively securing bookings to get benefited from keeping their low-cost raw materials.

Current Offers

• Steel Grade Pig Iron – The latest offers for Steel-grade Pig Iron through Durgapur-based mills are reported at around Rs 42,500-43,000/ton ex-works in east India and in Raipur, the prices stood around Rs 41,500-41,800/ton. The prices in Durgapur gained by Rs 2,500-3,000/ton and in Raipur by Rs 1,500-2,000/ton against offers on 30-31 March 2023.

• Foundry Grade Pig Iron- Prices of Foundry-grade Pig Iron have remained more or less unchanged as the participants are waiting for the price revision through the major foundry-grade Pig Iron producers based in the west and southern India. Current offers range from Rs 46,000-46,500/ton in Ludhiana, Rs 46,000-46,300/ton in Delhi, and Rs 48,100-48,500/ton in Ahmedabad; on a delivered basis.

Future Prospects

As per industry participants, the prices of Pig Iron should stabilize now that they have increased sharply as per expectations. Generally, demand slows when there is a constant surge in prices, they added. This indicates a slight change in prices as per spot demand in the market.

Insight

The Indian Pig Iron market has turned optimistic in FY24 after a constant drop in the last quarter of FY23. The surge in demand due to dry stock with both traders and smelters and the limited scope for a downtrend in Steel prices of mid-sized Steel mills has resulted in an increase in Pig Iron prices.

The latest offers for Steel-grade Pig Iron through Durgapur-based mills reported an increase in prices in east India and Raipur, while the prices of Foundry-grade Pig Iron have remained more or less unchanged. The prices of Pig Iron are expected to stabilize now as they have increased sharply as per expectations.

Read more: Here’s Why India’s Steel Market Reported Mixed Response On Opening Of Fiscal Year 2023-2024

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