India: Sponge iron prices rise further on higher offers - 16 Jan

With producers quoting higher, sponge iron prices in India increased by INR 300-500/t in key locations on 16 January, 2023. The rise in raw materials prices was the key factor driving sponge prices. SteelMint understands that despite the positive outlook, sponge iron demand remained modest today as buyers resisted high offers, which ultimately led to limited spot trade volumes across domestic markets.

About 15,270 t of sponge iron transactions were recorded today in India as against 13,070 t on 14 January.

Snapshots of key markets

• Rourkela: Market participants booked material as per requirements. Several players in the market adopted a wait-and-watch approach, which resulted in limited spot trades. Participants are anticipating a further rise in sponge iron prices after OMC's auction on 17 January.
  
  
• Raipur: Limited trading activities were observed in the market at higher offers. Prices increased by INR 300/t today as sellers were not willing to quote lower offers. Hence, traded volumes also remained low. Firm sentiments in north India also kept prices on the higher side in Raipur.
  
  
• Bellary: Buying activity remained slow today as buyers showed less interest in booking material at higher prices even as semi-finished steel prices across India continued to fluctuate throughout the day.
  
  
• Durgapur: Spot trades remained moderate today. Prices rose due to positive sentiments in the northern region.
  
  
• Ramgarh: Trade volumes remained low due to weak demand. Buyers were seen securing positions by opting to wait and watch.
  
  

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