NMDC Nagarnar plant seen auctioning 1.8 lakh t of pig iron by Nov'23

The sale of pig iron from NMDC's Nagarnar Integrated Steel Plant (NISP) continues. As per the latest information available to SteelMint, NISP is poised to sell another 15,000 tonnes (t) of pig iron in the next 2-3 days through an auction.

Thus, post-the upcoming auction, in total, NISP would have sold around 64,000 t of pig iron, in which the share of prime grade would be around 39,000 t and the balance 25,000 t, pooled pig iron.

Earlier, in the third week of August, NISP had conducted its first-ever steel-grade pig iron auction for 24,000 t. This was followed by another auction in the second week of September, for 15,000 t. The entire quantity in both the auction was booked in the price range of INR 37,500-38,100/t. On 29 August, the plant had also sold 10,000 t of pooled pig iron.

The plant is expected to auction another 50,000-60,000 t per month each over the next two months. Therefore, in total, around 1.80 lakh tonnes are likely to be sold through the auctions by November by NISP.

The larger picture behind the production and sale of such volumes of pig iron lies in the fact that the plant is currently testing its hot metal. This is leading to the production of pig iron as a by-product.

Eventually, the plant will be rolling out hot rolled coils (HRCs) which have also been going through a pilot process, as per information available to SteelMint. The trial run of the hot strip mill was conducted in late June.

With an additional almost 2 lakh tonne injection of pig iron in the merchant market from NISP, prices of this material may come under pressure.

Meanwhile, in line with the Cabinet Committee on Economic Affairs (CCEA) approval, NISP is in the process of being demerged from NMDC into a separate company, Nagarnar Steel Limited (NSL). Subsequent to the demerger shares of NSL will be listed on BSE, NSE and CSE.

The 3-mntpa plant will have a product mix that includes pig iron, HR coils/plates/sheets of various specifications, automotive steel and other items.