India: Sponge iron prices edge down as steel prices weaken - 23 Mar

Sponge iron prices in India fell in the range of INR 100-300/tonne (t) in key locations today, with spot trades remaining moderate due to the continuous decline in steel prices in north India, particularly Punjab. This resulted in downward pressure on prices in various regions and suppliers experienced slight selling pressure resulting in decline in both offers and bids.

According to sources, uncertain price movements weighed on spot trade volumes. About 20,890 t of sponge iron transactions were recorded today as against 13,300 t on 22 March. While this indicates a slight increase in demand, the overall trend is bearish.

Snapshots of key markets

• Rourkela: Prices trended down on lower bids followed by volatile prices in north India. Buyers were cautious and weak spot trading was observed at lower offers. Thus, prices continued to soften.
  
  
• Raipur: The market remained slow with limited spot trades. Sponge iron prices decreased marginally today as there was limited movement in the market.
  
  
• Bellary: Sponge iron buying activity strengthened today due to a moderate increase in demand throughout the day. Sponge iron offers remained stable today supported by semi-finished steel prices.
  
  
• Durgapur: The market weakened further because of bearish sentiments in other key local markets. Spot trades were moderate as weak market conditions kept buyers off bulk bookings.
  
  
• Ramgarh: Prices were almost stable today. However, spot trades remained less than average resulting in limited enquiries. Market participants were low on confidence about booking material due to continuous volatility in steel prices.
  
  

Rationale -

This index has been derived based on transactions, offers, bids and an indicative price data sets. Transactions are considered as T1 and given a weightage of 50% whereas other data sets are considered as T2 and given a weightage of the balance 50%.

Click for detailed methodology

T1 - Trade, T2 - Offer/Bid/Indicative