With no demand improvement observed in the first two weeks of April, activity in the international pig iron markets has remained slow.
Pig iron producers increased their prices as of the first week of April considering the deals concluded by the Turkish producers in late March, the purchases performed by some European traders aimed at replenishing their stocks and also due to the strong situation of the scrap markets.
Russian producers are currently thought to be happy enough just monitoring the markets and maintaining their current price levels. This is because Russian producers have filled their order books for April shipments and almost for all May output. Also, at present there is not a lot of Ukrainian and Russian origin material in the market for prompt shipment. Ex-Russia BPI export prices have been at $250-255/mt in the past week. Meanwhile, Ukraine origin BPI export offers increased to $210-215/mt FOB during the same period.
Meanwhile, in Europe producers working at low capacity and also foundries have been hesitating to buy large tonnages. Apart from this, SteelOrbis has been informed that European traders, who have been slowly melting their stocks, have been responding to their customers and have started buy in tonnages (though not in large quantities) in order to keep some material in stock.
Keeping their production capacities at fifteen percent, in the past week Brazilian producers increased their export prices by $20/mt to $230/mt FOB southern Brazil compared to the week before. As there has been no demand improvement in the US and as no activity is expected before the third quarter, Brazilian producers have turned their attention to Asia, which currently seems to be the only market interested in buying. In the last week there were two BPI deals from Brazil to China and Taiwan at the abovementioned price level. It is mentioned that the acceptable price level for BPI in China is at $265-270/mt C&F.
Some foundries in Turkey that received new orders are reported to have bought material in the last week. In addition, foundries supplying the automotive and white goods sectors have purchased materials due to the slight improvement in activity in these sectors compared to recent months and due to the weakened levels of their stocks. Local BPI price levels in Turkey have been at $285-290/mt + VAT, with the foundry pig iron price at $350/mt + VAT.
As the raw material contract talks have not yet reached a conclusion, pig iron producers in general are being put under pressure to increase their outputs. At the same time, the developing situation in the active markets is likely to shape raw material suppliers' activities in the global markets in the upcoming weeks.