Sponge Iron Prices, Iron Ore Supplies and Steel Market
October 23rd 2011 11:23
With the acute shortage in the supply of Iron Ore and power crisis the prices of Sponge iron has gone up in India. Thought the prices of Iron Ore are falling sharply in the international market, the acute shortage of supplies of iron ore to the domestic sponge iron industry has driven the prices and affected the production. The sponge iron prices in India, increased by 2.6% WoW to INR 23,700.
The Prices of Iron Ore of origin India, which is regular demand from China, decreased sharply by 6% to US$ 165/Mt, almost down by US$ 33 compare to its peak trading in the month of Feb 2011. This was the result of major back off by the investors in the metal commodity and global sell off in bullion. The negative sentiments across the world also kept the investors cautious.
The prices of the Indian Long Steel have increased by 3%-6% and the flat product prices rose by 1%. This upward trend may be due to the acute shortage of iron ore, power crisis and high sponge iron rates.
In comparison to the prices of steel in the global market, the Indian steel prices are up. The steel in China declined by 4%, Europe dip by 0.5%, Middle East by 1.7% and the prices of steel remained stable in Turkey and Russia.
There was a sharp selling recorded in Steel long products on NCDEX, despite of lower circuits. In Oct 2011 the prices of steel long product was at its peat at INR 31,380 per metric ton, and dived down at INR.27550 per metric ton this week. This fall was around 12% comparing to the last four sessions.
The buyers from Chinese Market for Iron Ore kept low in purchasing and finalizing the fresh orders. Some of the small mills in China have stopped their production. Other steel mills have gone for maintenance for weeks to 2 month or more. This can be a major step is avoiding the production till the demand in steel improves and the prices of iron ore drops further.
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