Prices for ex-Brazil basic pig iron (BPI) have fallen this week due to rumors about a fresh deal signed at lower level, in line with expectations. Although US buyers have been insisting on even bigger drop, considering local scrap decline for May, the final discussed prices have been somewhere in between buyers and sellers targets.
A deal for 50,000 mt of ex-Brazil BPI with 0.15 percent of phosphorus content has been discussed in the market at $415-420/mt FOB North Brazil for July shipment, translating to around $440-445/mt CFR New Orleans. Last week, the workable level has been assessed at $430-435/mt FOB. Although this deal has been not finally confirmed, market sources believe that this level is a compromise between buyers and sellers.
“US buyers are in a much stronger position after $30-40 drop in scrap [locally for May] and were certainly pushing Brazilian mills down,” a trading source said. The US local scrap prices have settled at $30-40/gt ($30-41/mt) lower level for May this week and the outlook for June is stable to low.
“Big players were trying to book at $400/mt FOB [translating to $425/mt CFR], but no deal has been confirmed at this level yet,” a Brazil-based source said, before information about new transaction emerged.
There have been very few bookings over the past month, so US buyers have been in a better position to push prices down after the new 10 percent duty was imposed.
The SteelOrbis reference price for import BPI price in the US has been settled at $440-460/mt CFR, including both low- and high-phosphorus material.