Brazilian basic pig iron (BPI) exporters have been more active in offering to Europe after announcement from U.S. President Donald Trump about the implementation of 50 percent tariffs on all Brazilian exports, effective from August 1. In line with expectations, Brazilian sellers had to offer below $400/mt FOB to compete in the European market, and buyers have continued to push the market down further.
A number of offers for ex-Brazil BPI have been heard in Europe at $410-415/mt CFR, translating to $375-380/mt FOB. “Everybody is calling, but inventories are good. The workable for us is just below $400/mt CIF,” a Europe-based source said. Another source said that European customers believe that they can get $380-390/mt CFR in some time, so they are not in a hurry.
As it was reported a week ago, the reference price in the European import BPI market was $400-425/mt CFR, which came down to $390-415/mt CFR for now.
Turkish market has been less attractive for Brazilian suppliers due to low price and much cheaper Russian material available and can be purchased by the most Turkish buyers, except a few mills. In the US market, Brazilians were not facing competition with Russia, and even if 50 percent duty will be finalized and not lowered in the US, it is unlikely that Russian material will return to the US (now Russia has 70 percent duty, but the recent prices are close to $300/mt FOB). “Business is stopped for now as people try to figure out what is going to happen. Economically, with where Russian pig is being sold, it could work if Brazil gets hit with 50 percent. But I have my doubts anyone will trust it long enough to move that direction. I also think US consumers are still pretty anti-Russian material at this point,” a US-based source said.
The SteelOrbis reference price for ex-Brazil BPI with 0.15 percent of phosphorus content has been settled at $370-380/mt FOB, falling from $400-405/mt FOB seen in the market weeks prior.