India: Sponge iron prices fall amid weak spot demand - 10 Feb

Sponge iron prices fell by INR 200-400/tonne (t) in key locations across the country. The prices fell sharply following the continued weakness in spot demand for semi-finished steel products. Sponge iron demand was low as a result of a significant price decline in the billets segment. The market saw limited buying activity, and the bids were observed to be on the lower side. Spot trade fell by 37% on a d-o-d basis which had an adverse impact on the market.

About 12,100 t of sponge iron transactions were recorded today in India as against 19,100 t on 9 February.

Snapshots of key markets

• Rourkela: Due to weak spot trades, prices fell through the day. The key reason behind lacklustre trade volumes was the price correction seen in major markets. Billet prices in Rourkela decreased by INR 200/t today.
  
  
• Raipur: Moderate booking was observed amid price drop. The market continued to show downward trend as the prices decreased slightly. Limited trading activity was done at lower prices. Buyers were hesitant to book material at current offers.
  
  
• Bellary: Sponge sales and demand have been significantly impacted by the dropping prices in semi-finished steels today, which resulted in weak buying activity in the market.
  
  
• Durgapur: The market continue to fall on sluggish demand for steel and sellers reduced offers on account of that. Spot trades were moderates as no major bookings were seen from the buyers' end.
  
  
• Ramgarh: Trading activities remained below average in the region as most market participants were unwilling to take positions amid volatile prices. Bookings were only made as per immediate requirements.
  
  

Rationale -

This index has been derived based on transactions, offers, bids and 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