Prices for basic pig iron (BPI) have been under strong pressure this week as bids from steel mills have been absent or much lower, while suppliers have also been reluctant to provide discounts for now, resulting in no deals.
The price of ex-Brazil BPI with 0.15 percent phosphorus content has remained at $430/mt FOB, which has been confirmed in the latest deals for the US and European markets. No new trades have been done over the past ten days and even the number of offers has been lower as suppliers understand that buyers are fully booked and will return to the market only by the end of the month with lower bids. “I didn’t hear many pig iron offers recently, but won’t be surprised if US buyers would push for $400/mt FOB [$430/mt CFR], since finished prices are sliding also,” an international trader said. “We are at the same price - $460/mt CFR [to the US, which is done in last deals], and trading is halted,” a Brazilian supplier said.
At the same time, in the Russian BPI export market trading has also been halted due to the high bid-offer imbalance. The SteelOrbis reference price has been settled at $370-390/mt FOB this week, down by $10/mt over the past week. The lower prices at $370-380/mt FOB are reflecting steel mills’ price ideas in Turkey and Europe, while, though officially Russian mills voice $405-410/mt FOB, if there is a need to sell, $390/mt FOB is assessed as the tradable level. At the moment, Russian mills are not in a hurry to drop prices to push sales, as previous tonnages sold to distributors are still unsold (and at higher prices), while there is still some time to wait.
In Europe, steel mills are seeing $400/mt CFR or $370/mt FOB Black Sea as the target level for the next purchases, while for small volumes for foundries prices at up to $420/mt CFR may work out. In general, buyers’ price ideas are now $10/mt lower than in early March.
As for Turkey, all eyes have been on the scrap market this week, which has been seeking its direction after a few slightly higher deals. But for pig iron, the highest tradable is assessed at $400-405/mt CFR, translating to $380/mt FOB Black Sea, but only for sizable lots.
The Asian market has also been halted since, with the recent drop in iron ore and steel prices in China, buyers have been reluctant to voice firm bids. However, offers for ex-Russia BPI have been heard at $400/mt CFR to China and Taiwan, while a few sources said that they are from the mill shipping from the Far East ports of Russia. As for India, the tradable level for BPI is assessed at $390-395/mt CFR.