India: SAIL Increases Base Price in Pig iron Auction; Fetches Moderate Response

SAIL conducted auction for 10,000 MT steel grade pig iron today in which it raised price by INR 800-850/MT against last auction. 35% of the material offered was booked.

Steel Authority of India Ltd (SAIL) - India's govt. owned steel maker has received moderate response in today's auction for 10,000 MT steel grade Pig iron from its Rourkela Steel plant (RSP) located in eastern India.

The company today has quoted base price of around INR 27,350/MT (ex-Rourkela) which is higher by INR 800-850/MT(about USD 12), than the previous auction which was held on 12th Apr'19 for 12,500-15,000 MT and got settled at INR 26,450-26,500/MT ex-plant.

As per participants, out of the total offered quantity, the company has received bids for close to 3,500 MT pig iron today and remaining material (65%) remained unsold.

"Limited supply by private producers amid higher offers led to moderate response in RSP's pig iron auction", the participants stated for today's SAIL RSP's pig iron auction.

The current offers in neighbouring markets by private mills hovering at INR 28,500-29,000/MT ex-Jharkhand, INR 29,000-29,400/MT ex-Durgapur & INR 27,700-28,000/MT ex-Jajpur (Odisha).

However, SteelMint learned that, the participants are aggressively waiting for Neelachal Ispat (NINL) fresh price circular which is due since 12th Apr'19 and the company's last offer was at INR 26,250-26,650/MT ex-plant, Cuttack (Odisha) for Steel grade material.

Participants believe NINL may raise pig iron prices by more than by INR 500/MT (USD 7) due to hike in offers by private mills & supply crunch of pig iron.