Sponge Iron Supply Improves in Indian Spot Market

Supply of Sponge iron which is the key fuel for standalone EA or Induction furnaces in India, has witnessed gradual increase amid clear weather supporting sponge production along with improved logistics of raw materials i.e. Iron ore, pellets & coal.

As per the Integrated plants in Raipur & Durgapur they have resumed sales for sponge in open market which was on hold couple of weeks ago owing to limited production, raw material scarcity and rising prices of Iron ore & Pellets.

The rake movement data compiled with SteelMint shows increased supply of Iron ore. NMDC, which is the largest iron ore miner in India has dispatched 151 rakes during 1st to 20th Sep'18 as against same duration in Aug'18 at 109 rakes, increased about 39% M-o-M.

Raipur, the major consumer of sponge in India, the Ingot/Billet manufacturers here have stated increased supply of sponge iron from the local suppliers as well as from Eastern India - Odisha & West Bengal. Presently the Sponge iron in Raipur largely source from Odisha owing to cheaper landed cost of about INR 300-500/MT than the offers by local manufacturers.

-- Integrated plants in Raipur have reduced sponge prices by INR 1,000/MT (USD 14) in last one week and the latest offers for P-DRI stood at INR 24,100-24,200/MT ex-plant.

Further, the major sponge producers in Durgapur have mentioned stockpiling amid disturbed power supply for more than a week during last week which resulted in dull interest for sponge iron.

-- Sponge iron prices in Durgapur down by INR 1,600-1,800/MT (USD 22-25) in a week duration and today the offers by Rashmi Metaliks for Sponge P-DRI heard at around INR 22,000-22,100/MT.

Odisha, the major supplier of sponge to across North-east & Central India. the producers here have stated rising inventories, hence dealing on discounts rather than the quoted offers.

-- Today the offers for Sponge C-DRI FeM 80 stood at INR 24,500-24,700/MT Ex-Rourkela, Odisha; down by INR 200/MT day-on-day.

-- As per sources, the Jharsugda, Bonai (Odisha) based manufacturers have sold Sponge C-DRI 70:30 mix material at around INR 25,500/MT FoR Raipur, excluding GST.