Prices for ex-Brazil basic pig iron (BPI) have increased in a deal this week, though a lot of market sources still believe that an upward trend is difficult and that further rises are questionable.
A contract for BPI with 0.15 percent phosphorus content has been rumoured at $415/mt FOB this week. Though most probably the deal was for the US market, it has not been confirmed by the time of publication. The previous deal for 50,000 mt of similar grade material was concluded at $405/mt FOB to a major US mill last week, according to sources. “Prices are increasing, it is true. But still, it is not a surprise really since [Brazilian] mills were aiming for $420/mt FOB even and hence had to give up their ambitions. The US is the only market paying slight premiums, while the UAW came to a tentative agreement and mills are pushing up HRC in an attempt to leverage on restocking gains from automotive producers after the strike. Overall, fundamentals remain weak, so I guess it’s just a short-lived and temporary uptick,” an international trader said.
Some market sources agree that a further slight increase in ex-Brazil BPI prices is possible if the hike in the local US scrap market is successful in November. However, going up above $420/mt FOB will be very difficult.