India: SAIL Pig Iron Auction Receives Weak Response Despite Reduced Base Price

Steel Authority of India Ltd (SAIL) today conducted an auction for 1,950 MT steel grade pig iron from its Rourkela steel plant (RSP) in eastern India. The auction witnessed weak participation despite reduction in base price by INR 500 (USD 7)/MT.

SteelMint's reliable sources revealed that only about 100 MT pig iron was sold at the base price of INR 27,000/MT EXW-Rourkela, while the remaining material (95%) remained unsold.

As per sources, the company has reduced the base price to INR 27,000/MT in today's auction as against the last one which was held on 26th Feb'20 in which the base price was kept at INR 27,500/MT EXW-Rourkela.

The weak response in today's auction is attributed to competitive offers by private producers & falling steel prices in the domestic market

-- The current offers of steel grade are hovering at INR 26,800-27,000/MT ex-Durgapur, INR 26,600-26,800/MT ex-Jharkhand, INR 28,000/MT ex-Raigarh/Raipur & INR 27,000-27,500/MT ex-Jajpur.

-- The landed cost of Jharkhand pig iron to Raigarh is estimated at around INR 28,000/MT, however if it is sourced from Rourkela then the landed cost would be around INR 28,200-28,400/MT FoR Raigarh. Thus, the buyers have turned toward private mills' pig iron rather than purchasing it from RSP auction.