Indian Sponge Iron Export Offers Firm on Improved Volumes

Indian sponge iron export offers remain firm this week, after it increased by around USD 10/MT last week. SteelMint learned, that volumes have increased on active buying from Bangladesh based melting furnaces amid rising scrap prices.

The latest price assessment for lumps of grade FeM 78-80, recorded at USD 388-390/MT CPT Benpole (dry land port of Bangladesh & India) and USD 405/MT CFR Chittagong, Bangladesh.

Indian exporters mentioned that, Bangladeshi smelters are preferring sea route over land route due to high congestion on road. According to them it is taking much longer (about 25-30 days) than usual to get custom cleared.

"More than 3,000 MT have been sold to the big plants at around USD 403-405/MT CFR Chittagong, for which dispatches will start soon" an Indian sponge iron exporter stated.

Domestic steel demand is good in the Bangladesh, in addition sharp surge in global scrap prices is another major factor behind healthy inquiries for sponge iron exports, he added.

The local ship breaking scrap prices in Bangladesh are reported at around 33,000-34,000 Bangladeshi Taka (BDT) or USD 395-408/MT, ex-works and excluding local taxes.

Further, the imported scrap offers to Bangladesh have moved further by around USD 5/MT W-o-W and are currently assessed - for Shredded (US origin) at around USD 400-405/MT & for HMS 1&2 from Middle east at around USD 380/MT, CFR Chittagong.

Indian Sponge Market

Indian domestic sponge iron prices correct by INR 200-400/MT this week as several Iron ore mines which were closed since Jan 2018, have been allowed to resume operations by Supreme court last week.

Market believes that Iron ore supply in India will increase in coming months, which may put pressure on prices.

Current offers for 78-80 FeM Sponge iron (C-DRI) are assessed at INR 22,000-22,200/MT (USD 339-342) ex-Durgapur & INR 20,400-20,600/MT (USD 315-318) ex-Rourkela, East India.

The same grade material in other parts like Central India-Raipur traded at INR 21,100-21,300/MT (USD 325-328) & in South India - Bellary at INR 20,400-20,600/MT (USD 315-318). The prices mentioned are ex-plant & excluding local taxes (GST at 18%).