The European import basic pig iron (BPI) market has been still silent due to holidays season, but market participants have been actively discussing further movements as quota for Russian BPI is about to finish in September.
European customers have been bearish, seeing no improvement in demand for steel and still weak scrap prices in Turkey, so bids for Russian BPI have been at $390-410/mt CFR, which translates to near $360-380/mt FOB. However, as for now this level seems hard to be reached, as the major sellers have been targeting $435/mt CFR or so, which is slightly above $400/mt FOB. “We are transferring materials to stocks [in Europe] and making customs clearance, trying to manage this until the quota will be filled. According to our expectations, it will happen on September 5-7. But on the other side, prices in China are low and this is putting pressure. We hope for some improvement in demand in China or some production cuts there,” a Russian seller said.
Also, some traders still believe in gradual rebound in BPI prices due to exhausted quota in September, though some said it will happen only in October.
The SteelOrbis reference price for ex-Russia BPI has been settled at $380-400/mt FOB Black Sea, stable over the week in absence of new deals. The price may come down to $370/mt FOB in the coming weeks, when the European market will be closed for Russian sellers, according to sources.
At the same time, relatively competitive offers from Asia are still seen in the market. In particular, after the previous sale of BPI from Indonesia to India at $380/mt FOB, the new offer for another cargo has been reported at $370-375/mt FOB.