Pig iron prices declined more than 5 per cent in the last two months in the domestic market following supply abundance from small- and medium-scale enterprises (the unorganised sector players) and falling demand from major steel producers. | |
| Now, the price of foundry grade pig iron is Rs 18,000 per tonne compared with Rs 19,000 per tonne two months ago. |
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| Steel grade pig iron is quoted at Rs 17,000 per tonne, down about 3 per cent from the price quoted two months ago. |
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| Degi scrap lost a little more than 2 per cent to Rs 16,000 per tonne, while CI turning slumped over 7 per cent to Rs 12,500 in the last two months. |
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| Degi casting was the biggest loser in this category with a fall of about 20 per cent to Rs 20,000 per tonne, ingot moulds (new) declined about 5 per cent and cut ingot moulds managed to almost hold on to their position, without losing much. They lost about 4 per cent to Rs 16,000 per tonne. |
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| In fact, the steel industry, which consumes whole of pig iron supply, is passing through a cyclical downward phase now, which, according to experts, would be overcome soon. |
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| Pig iron is a major raw material for production of cast iron through foundries. It is also used for steel production directly. |
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| "Pig iron prices have declined because of falling demand from steel producers. There are two reasons for slump in demand from steel producers - its substitution with scrap and downturn in demand from main steel producers. Steel producers have cut their production by about 5-10 per cent in order to clear the existing stocks," a trader said. |
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| "Once steel production starts in full swing, demand for pig iron will increase, but it may take at least four months," the trader added. |
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| Since the steel industry was delicensed and decontrolled in 1991 and 1992 respectively, steel and raw material production in the country has grown substantially. |
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| Also, now domestically available advanced technology in line with the seel industry around the world has brought the country the ninth largest crude steel producer status, with finished steel production of 38.385 million tonne recorded in 2004-05. Total pig iron production in 2004-05 was 3.171 million tonne. |
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| "Pig iron has moved much since the beginning of the year when it was hovering around Rs 19,400 per tonne. However, the current depression in steel sentiment is expected to continue for some time more," the trader added. |
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