Brazilian pig iron export tonnages were down 45 percent in September year-on-year, following an approximately 7 percent decrease on an annualized basis in August. Given the overall loss of exports along with domestic market challenges, Brazilian (high manganese) steelmaking basic pig iron was previously offered as low as $235/mt FOB Brazilian port and $240-250/mt CFR New Orleans. November scrap pricing is looking stronger as a result of recent increases in US export scrap prices, and sources report an overall expectation for finished goods to rebound as prices in the international market are edging higher. As such, steelmaking basic pig iron from Brazil is currently being heard at $245-255/mt FOB from the Northern region, $240-250/mt FOB from the Southern region, and $250-260/mt CFR New Orleans.
CIS steelmaking basic pig iron price offers have also moved up to the higher end of the range on tighter supply at $245-250/mt FOB Black Sea. Rises in coal and coke prices as well as the expectation of more stable to higher scrap prices are being stated as the rationale for the price increases and buying opportunity. Yet, US distributors are wary since mills and foundries in the US domestic market have lowered capacity utilization rates. Additionally, end of year inventory management at service centers and mills to minimize tax liability may continue affecting production. Deals are expected to remain limited and at a discount from offers through the remainder of 2016.