India: Sponge iron prices fall tracking decline in steel prices - 16 Mar

Prices of sponge iron decreased by INR 50-250/t in key locations today on falling steel prices followed by lower bids. Even as trades improved significantly, they remained just about moderate resulting in offers softening further. Market participants seemed to lack trust in the direction of prices. Despite the ongoing price reduction, buyers are still acquiring material as per immediate requirements.

About 20,550 t of sponge iron transactions were recorded today in India as against 12,500 t on 15 March.

Snapshots of key markets

• Rourkela: Even though prices decreased on hazy market trends, trading increased as some buyers began purchases again leading to an increase in spot trades compared to yesterday. Plenty of deals were booked for Patna.
  
  
• Raipur: Sponge Iron prices slid further amid low acceptance of higher offers which forced sellers to decrease prices. Prices of semi-finished and finished long steel also remained subdued as the overall market witnessed a declining trend. However, spot trading increased significantly as buyers started to book material on lower offers.
  
  
• Bellary: Sponge iron prices decreased due to weak demand and few buyer inquiries; need-based buying was seen today at lower prices.
  
  
• Durgapur: The market witnessed a downtrend today as sentiments in the northern region remained bearish. However, a significant improvement was seen in spot trade volumes d-o-d.
  
  
• Ramgarh: The market remained mostly silent owing to limited spot trading. Semi-finished steel movement was impacted due to weak demand in the northern region, and hence many sellers reduced their offers.
  
  

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