The uptrend in the scrap market which has continued to accelerate lately on the back of the huge stir in buying activity in Turkey has bolstered the bullish moods of global basic pig iron (BPI) suppliers. Furthermore, being strongly upbeat towards future developments, global BPI sellers are not in a rush to sell now. Brazilian BPI producers, in their turn, have been attempting to find additional support from lower supply. Specifically, most of them have lately been in the market with material for May shipment. “Turkey is back with scrap and the Brazilians are not willing to offer lower than $500/mt FOB,” an international trader stated. Meanwhile, SteelOrbis has learned of a fresh booking of 50,000 mt of ex-Brazil BPI, with 0.15 phosphorus content, done this week to the US at $530/mt CFR Port of New Orleans, for May shipment. The price is around $10/mt higher than the level in the previous booking done at the beginning of February. Taking into account the current freight rate and financing costs, the FOB price may have settled at $500/mt FOB, which is in line with the initial targets of the supplier. Ex-Brazil offers of BPI, with 0.08 phosphorus content, to Europe or to the Mediterranean region, including Turkey, have been heard at $530/mt CFR. Meanwhile, some global traders have continued to question the likelihood of a further uptrend. “I still doubt a sustainable recovery since it rather appears to be a supply and availability issue than structurally demand-driven. US mills are pushing HRC and slab prices up, though it needs to be seen if and how this will materialise with end consumers, as downstream demand in the US remains lacklustre as well,” a European trader stated.
Following a few unsuccessful attempts to get a desired price, major Indian steel company Vedanta Limited has ultimately closed its export tender for 20,000 mt of BPI, with shipment on February 27-28. According to reliable sources, a deal has been signed to the Southeast Asia at $482/mt FOB, though the supplier had been seeking to get $495-500/mt FOB. “The situation is a bit choppy and there are still some concerns on the demand side. However, it should be better in March,” an Indian source stated. Meanwhile, local BPI prices in India have moved sideways. In particular, BPI quotes in the eastern regions are at INR 43,500/mt ($526/mt) ex-works, unchanged week on week, while prices in the western regions have settled at INR 42,000/mt ($508/mt) ex-works, up INR 500/mt ($6/mt) week on week.
In the meantime, Russian BPI suppliers appear to have left the market, anticipating to get higher prices in the coming week. The latest ex-Donbass BPI offer has been heard at $420/mt FOB. “From what I have heard from the Russian market, it is currently difficult getting offers for bigger quantities,” a European trader stated.
Likewise, Ukrainian BPI suppliers are not offering actively now. The latest deals for ex-Ukraine BPI to Europe have been heard at $520/mt CFR Marghera.