India: Sponge iron prices fall further on limited buying interest - 19 Apr

Sponge iron prices fell by INR 100-200/t in some key locations across the country due to a lack of buying inquiries in the spot market. As a result, suppliers in various regions reduced their offers today. However, prices in the southern region edged up amid supply shortage.

A total of 8,800 t of transactions were recorded today as against 13,960 t on 18 April.

Why have prices dropped?

• Lesser spot trade: Trade activity stayed below average. Market participants lacked confidence in the direction of price movement. Spot trading, hence, was severely impacted with volumes decreasing by 37% d-o-d. Due to low interest among buyers, bids remained on the lower side.
  
  
• Declining billet prices: Following the continuous decline in spot demand for semi-finished steel products, prices dropped significantly. Low demand for sponge iron was due to the drop in billet prices by INR 100-350/t across regions.
  
  

Rationale -

Prices have 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