With restrictions on the state’s crude steel production having been implemented in China, import activity for basic pig iron (BPI) from Chinese steelmakers has notably picked up. According to SteelOrbis assumption, at least eight cargoes for total around 400,000 mt of BPI have been booked into China so far in September, with buying interest from steelmakers maintaining at its highs.
Accordingly, this week SteelOrbis has learned of bookings of three ex-Brazil BPI cargoes to China, each for 60,000 mt, for shipment in November-December. The prices in the abovementioned transactions are said to be at the range of $545-550/mt CFR, though some market sources insist that the final prices to the end-users in China have been fixed not below $557-560/mt CFR, including freight costs at $67-70/mt and financing. One way or another, it appears that Brazil-based BPI suppliers have not succeeded in achieving their target prices, voiced at $500/mt FOB, with a FOB price in the latest deals being at $485/mt FOB at the highest, up $5/mt compared to the previous deals done to China and the US, in particular. However, being to a large extent sold out until the end of 2021 year, the Brazil-based suppliers are most likely to step up their attempts to raise prices in approaching negotiations.
Another cargo of BPI from Ukraine, for shipment in October is said to have been sold to China at $550-555/mt CFR this week, in line with previous booking for ex-Russia BPI to China done a week ago. The freight from Black Sea region to China is assumed at $70-75/mt.
SteelOrbis has heard of ex-Ukraine BPI sale to the Emirati customer at $590/mt CFR. The overvalued price is caused by lower content of sulphur.
Despite most of global BPI market suppliers are quite optimistic on the future developments in the market, there are market insiders holding other persuasions. “I still believe the ferrous metallics supply chain will face some headwinds and tough times for the months ahead, until Chinese New Year and Olympic Winter Games at least,” an international trader stated.