From November 2016, HBI deals from Venezuela to the US and Southern EU destinations climbed as high as $240/mt FOB and gradually declined to $200-215/mt FOB by late January 2017. At the time, sources expected deal prices for the remainder of the first half of the year to return to the $180-200/mt FOB range, a range that was prevailing in October 2016.
Reviewing Venezuelan HBI through the first half of 2017, the commodity has been unable to fully take advantage of the overall positive trend in US scrap prices and high Brazilian pig iron prices to the US due to timely delivery concerns from their ports as well as country of origin economic risks. However, HBI has fared better than expected.
In April, the deal range on 30,000 mt average size export cargos to a variety of destinations increased to $200-220/mt FOB but widened down to $190-220/mt FOB in May. While the majority of May deals to various destinations were in the $190-200/mt FOB range, especially at month’s end, sources note 2 or 3 May deals closed on the higher end at $215-220/mt FOB due to “special requirements.” Specifically to the US, a May deal was confirmed at a rate of $260-265/mt CFR Alabama port, which would correlate with a rate of $210-220/mt FOB.
In early June, general export offers for Venezuelan HBI are currently being heard at $200-220/mt FOB (Palua port). For now, sources expect export HBI deals to trade in the $195-210/mt FOB range with US deals likely between $200-210/mt FOB.