India: Sponge iron prices up on active buying - 14 Feb

Sponge iron prices in India have been on the rise since the last few days. Today, prices have increased by INR 250-600/t in key locations on the back of active demand, optimism in the spot market, and higher offers quoted by suppliers. Producers have been able to keep prices on the higher side due to a flurry of deals taking place, which were partly driven by the rise in billets prices by INR 150-750/t. These positive market sentiments have led to buyers taking position which, in turn, has resulted in an increase in trade volumes.

About 25,020 t of sponge iron transactions were recorded today in India as against 24,610 t on 13 February.

Snapshots of key markets

• Rourkela: The uptick in prices can be attributed to active demand and higher offers from suppliers. A rise in steel prices in the northern region, particularly in Punjab, has resulted in sponge iron demand recovery. This led buyers to take positions in the market, which ultimately resulted in an increase in trade volumes.
  
  
• Raipur: Moderate trading activity at higher prices was witnessed. The market showed an uptrend and prices of semi-finished steel also improved. Offers by sellers were on the higher side and moderate bookings were done at these levels. The northern region market showed a fluctuating trend.
  
  
• Bellary: Buying activity in sponge iron was decent amid a sudden increase in prices in the northen region. Spot trade also improved significantly.
  
  
• Durgapur: The market was up on account of positive sentiments in the northern market which pushed sellers to raise their offers. Spot trade was moderate as price volatility continued throughout the day which kept buyers cautious.
  
  
• Ramgarh: Sellers increased offers following a price hike in Mandi Gobindgarh. Market participants are anticipating prices to stabilise in the near term.
  
  

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