The rapid rise in scrap prices in Turkey has gradually rippled across the global basic pig iron (BPI) market. At the beginning of the week, some BPI suppliers withdrew their offers and took a pause, aiming to evaluate opportunities to increase prices for pig iron following the rise in scrap prices. Meanwhile, China, still being the only solid buyer in the market, intends to “set up its own rules of the game,” one source said.
After an ex-Ukraine pig iron cargo purchase at around $295/mt CFR at the end of last week, bids from Chinese customers have hovered at $290-295/mt CFR, with no seller around. Later, China has started to test the market with rare bids at $300-305/mt CFR, but for short lead times. “China is seeking material with May shipment, while the majority of mills are sold out until June,” a trader told SteelOrbis. “I have a few firm bids at $300-305/mt CFR. However, I couldn't get any offers from mills,” another trader said, adding that suppliers who have material in position can take advantage of the current situation.
According to sources, after a week of silence, a few Brazilian suppliers have voiced their offers for June-July shipments at $280/mt FOB southeastern ports, with some $5-10/mt additional discounts possible. At the end of week, SteelOrbis has been informed of a 60,000 mt ex-Brazil pig iron booking to China at $265/mt FOB, which corresponds to slightly below $300/mt CFR, the sources estimate.
As leading CIS-based suppliers have taken a wait-and-see position to evaluate the market, the indicative prices for ex-CIS BPI have remained at $265-290/mt FOB, with the higher end voiced by Russia and not considered workable for now.
The European and the US pig iron markets remain on standby mode, with insiders concerned regarding the recovery of business. “It’s still quiet here with no activity. Scrap has fallen a lot so far, but many have not even entered the market yet due to uncertainty and impending capacity shutdowns,” a US-based source told SteelOrbis.