India: Sponge iron prices rise further on higher offers - 12 Jan

Sponge iron prices in India continued to rally in the range of INR 200-550/t in key locations on account of higher offers floated by the suppliers. Buying activity in the spot market increased significantly during the last couple of days. A limited number of deals were concluded today. Due to healthy purchase enquiries and rising prices in the Punjab market, producers were forced to raise their offers today. Market participants were less active compared to yesterday because of higher offers.

About 16,410 t of sponge iron transactions were recorded today in India as against 38,900 t on 11 January.

Snapshots of key markets

• Rourkela: Sponge iron prices rose due to optimism in the market. Producers kept prices strong as several deals took place triggering the rise in prices today, sources informed. As a result, spot trades remained active throughout the day leading to the increase in prices.
  
  
• Raipur: In central India, spot trade volumes remained on the lower side as buyers opted to wait and watch. The majority of buyers held their bookings today after having placing sufficient orders yesterday.
  
  
• Bellary: Sponge iron offers remained strong today, yet bookings slowed down d-o-d as a result of sellers having booked a sizeable volume of orders yesterday while buyers too remained less active.
  
  
• Durgapur: Spot trades were moderate throughout the day. Sellers increased offers as stable prices in the northern region kept prices supported across markets. Prices rose by INR 550/t d-o-d.
  
  
• Ramgarh: Prices remained firm throughout the day but buying interest fell marginally on higher offers.
  
  

With healthy trade volumes being reported from across markets in different states, sources are expecting sponge iron prices to remain strong.

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