European buyers have continued to put pressure on import basic pig iron (BPI) prices in late September and early October and, even though there have not been so many sellers ready to provide big discounts, the market is driven by buyers now. At the same time, in the HBI segment in Europe and North Africa, the situation has been the opposite, and prices have increased amid the urgent needs of customers and the lack of many cargoes available in the market, together with higher freight rates.
The reference price for import BPI in Europe has settled at $390-407/mt CFR with the midpoint at $398.5/mt CFR, down by $14/mt on average from the level seen a month ago.
There has been talk in the market about a sale of Ukrainian pig iron to Italy for October shipment and, though the final price could not be confirmed by the time of publication, all market sources polled by SteelOrbis agree that the prices are down compared to the tradable levels in early September. Some sources in Europe said that the price level was slightly below $410/mt CFR, while the target of the mill was at $425/mt CFR a month ago and at around $415-420/mt CFR in late September-early October. Some market sources involved in trading to the EU said that they heard that this deal was done at below $400/mt CFR, since, with the current market softening, this reflects the targets of most large buyers in the EU.
“If a European customer buys cheap “exotic or illegal” pig iron, he can accept higher prices for Ukraine, having still a good price on balance,” a source said, saying that a deal price level slightly above $400-405/mt CFR is possible, despite buyers’ very low targets.
European buyers’ price ideas for alternative origins like Zimbabwe, South Africa and India stand at around $390/mt CFR, but no new deals have been reported so far. “We were all waiting for news from Zimbabwe [as there was talk of up to 100,000 mt negotiated in the market], but nothing new was sold. The price would not be an issue, but they have difficulties with transportation as they need to ship from another African country,” a market source said.
In the HBI segment, there has been no oversupply and one deal for ex-Libya HBI was signed last week at $347/mt CFR North Africa for prompt shipment. “There was an urgent need and not that many cargoes available,” a source explained. After this contract and higher scrap prices in Turkey, the tradable level for import HBI to Italy has also increased, being near $340/mt CFR or slightly above. But “the price is lower from other countries such as Venezuela, at around $330/mt CFR,” a European source assessed. This means that the import HBI price in Europe has risen to $330-345/mt CFR, from $315-325/mt CFR over the past two months.