IRON and STEEL
In southern region of India, Bellary (Karnataka) sponge prices have inclined upto INR 900/MT (USD 13) in a week's time. Participants reported falling inventories amid less availability of raw materials which resulted in price hike in the market.
According to producers in the state, presently inquiries for sponge iron remains in the same level while price rise seen in the market over fall in Iron ore & pellet availability as DMG (Department of Mines and Geology, Govt of Karnataka) has been making changes in its software system, which is an online portal through which iron ore gets transported.
Inline raw materials - Pellet offers in Karnataka market rise by INR 400/MT W-o-W & stood at INR 7,200-7,400/MT (basic).
In addition, a trade supplier reported a major steel mill in Karnataka booked huge quantity of pellets from the local market over DMG issue, which leads to short supply.
SteelMint’s assessment for 78-80 FeM coal based Sponge C-DRI (Bellary) are reported at INR 19,700-19,800/MT (USD 286-288) which have increased by INR 900/MT compared with last week assessment at INR 18,700-18,800/MT (upto USD 272) ex-plant.
One of the major sponge producer in the region, having sponge iron production capacity of 2,200-2,300 TPD (0.7 MnT pa). The company has sold out P-DRI lumps (80 FeM) at INR 19,100-19,200/MT ex-plant. However as of now they hold their sales & willing to increase prices by INR 300-400/MT.
Another renowned manufacturer in the state namely BIOP Steel who makes prime grade material (high metalization) has offered C-DRI lumps (80 & 82 FeM) at INR 19,500/MT & INR 19,900/MT. Prices are on ex-plant basis.
Karnataka is the third largest sponge iron producing state in India which contributes about 9-10% in country's total DRI production. The sponge iron produced in the state are largely sell to Western India - Maharashtra, Gujarat & Rajasthan and in the surrounding states including local market.
In context to price movements in other regions, it remains volatile by INR 300-500/MT in Central & Eastern India on sufficient availability. The price range of Sponge P-DRI is hovering at INR 18,400-18,600/MT ex-Raipur, Central region & INR 18,900-19,100/MT in Durgapur, Eastern India.