Foundry grade pig iron is now exported from Brazil at $312/mt, FOB, compared to a range of $320/mt to $335/mt FOB three weeks ago and to $350/mt FOB six weeks ago, a major independent producer in the State of Minas Gerais told SteelOrbis.
He mentioned that the last sale was closed for delivery in July, and that his production is sold until August, adding that in his view the producers of the steelmaking grade product are not achieving profitability under the current level of prices.
“We made a huge investment in equipment, so our additional cost to produce the foundry grade, compared to the cost to produce the steelmaking grade, is very low, in the range of $10/mt,” he said, adding that his profitability derives entirely from the premium of the foundry grade.
He added that the plant remains operating at full capacity, but they should have to stop operations if they were limited to the production of the steelmaking grade.
In the domestic market, the company is selling the foundry grade product at BRL1,100/mt ($364/mt) FOB, the same price as one month ago.
$1 = BRL 3.02