Since the middle of October, business activity in the global basic pig iron (BPI) market has notably picked up, with one of the key US steel producers having entered the market in order to refresh its stocks.
Accordingly, following an ex-Russia BPI purchase at $369/mt CFR Port of New Orleans two weeks ago, Nucor booked two more cargoes of ex-CIS BPI last week. One deal was concluded for 50,000 mt of ex-Ukraine BPI, for December production, at $373/mt CFR, while in another deal a Russia-based producer already managed to achieve $377/mt CFR, for the same volume and shipment in the same month.
Meanwhile, the buying spree in China has slackened recently, according to sources. “China is very quiet these days. Buyers’ ideas hardly touch $380/mt CFR. Rumors of a possible relaxation of the scrap import ban keep them on their toes,” an international trader told. “Chinese buyers are targeting $390/mt CFR, but are unsuccessful as of today,” a representative of a CIS-based mill commented. In the meantime, the suppliers are not in a hurry to sell at lower prices, citing the limited allocation of material. SteelOrbis has been informed of Russia-based Tula’s BPI offers, for February shipment at $415/mt CFR.
Meanwhile, Russia-based Evraz sold 15,000 mt of BPI to Taiwan at $392/mt CFR, SteelOrbis has learned.
Taking into account the abovementioned deals, SteelOrbis’ assessment for ex-CIS BPI prices has narrowed to $354-358/mt FOB Black Sea, versus $350-360/mt FOB Black Sea two weeks ago.
Furthermore, SteelOrbis has learned of a fresh sale of 50,000 mt of ex-Brazil BPI, for January production, to an international trader at $355/mt FOB, which corresponded to the lower end of the offer range. The material is destined to be supplied to China. Meanwhile, another Brazil-based supplier is going to raise BPI offers to $415/mt CFR shortly, citing increased costs. “Pig iron production costs are exploding here, coupled with messed-up iron ore availability, the charcoal price increase, and the rainy season beginning,” the seller explained.