The global basic pig iron (BPI) market has been still weak with buyers’ price ideas in the major sales destinations going down more and suppliers facing reduced demand. Among very few outlets, where discussions for new deals for BPI have continued, was Turkey.
The benchmark US import BPI market has been stable and inactive at $445-450/mt CFR fixed in the previous deals. Ex-Brazil BPI suppliers have been not in a rush to conclude new deals, still offering at $420/mt FOB and being mainly sold out for August shipment. Though expectations for the local scrap market in the US have been mainly negative, shredded scrap in most US regions has settled stable in July, with the Chicago market settling down by just $20/gt.
Nevertheless, there has been an export tender for BPI from India this week with the seller targeting $420-430/mt FOB, but the highest bid in the auction was just $385/mt FOB, according to market sources. This bid translates to around $425/mt on CFR basis to the US, including freight and some expanses, meaning that traders are still seeing the market as soft.
The SteelOrbis reference price for ex-Black Sea BPI has been at $330-350/mt FOB this week, down $5/mt on average from $330-360/mt FOB last week. However, this reference price is reflecting mainly offers from Russia and Donbass and rare deals, while new bids from buyers have been already at $5-20/mt below these levels.
In particular, in Italy, offers for ex-Russia BPI have slipped to $380-390/mt CFR from $385-400/mt CFR last week, translating to around $340-350/mt FOB. But the major steel mills in the country are targeting hardly above $370/mt CFR for new purchases.
In Turkey, the last deal for ex-Donbass BPI was rumored at $335/mt FOB or $360-365/mt CFR, as SteelOrbis reported earlier this week. But there has been information that new negotiations may be held at $5-10/mt lower levels. “In distribution, the Russians offers are at $370-375/mt FOT equivalent in TRY, but for new cargoes for August shipment prices could be different,” a trader said.