Prices for exported basic pig iron (BPI) from Brazil have been corrected down slightly since last week amid bearish sentiments in the local US scrap market and the weak demand which is expected to persist. However, last week a few cargoes for ex-Ukraine BPI were rumored to have been sold to the US at relatively high prices.
In particular, two cargoes of ex-Ukraine BPI with 0.12 percent phosphorus content were rumored to have been sold to the US at $515/mt CFR, as reported by a number of sources. This price has been considered “right” by some sources, as the phosphorus content was lower than the 0.15 percent in BPI deals by Brazilian suppliers done at around $480/mt FOB earlier this month, translating to around $505/mt CFR New Orleans. However, some market participants have been assessing the recent prices from Ukraine as being on the higher side, given the weak market conditions in the US, and they have been assessing the real market price in these two deals at not above $510/mt CFR. Some sources said that the seller confirmed 0.10 percent phosphorus content in the material in these deals, but this is doubtful and can be only for some small tonnage in each cargo, SteelOrbis learned, and again by the time of publication no ex-Ukraine deals were confirmed by either side, with most major importers in the US denying they had purchased.
The latest offers for ex-Brazil BPI with 0.15 percent phosphorus content have been assessed at $500/mt CFR or $475/mt FOB, down by at least $5/mt from last week’s targets. Firm offers for 0.10 percent pig iron from Brazil have been limited due to the “high costs of production”, a local source said, but the indicative level for this grade is assessed at $510/mt CFR in the US now.
As reported earlier, June scrap prices in the US are expected to fall by $20-$40/gt due to still-falling flat rolled steel prices and less-than-exciting scrap export activity. Prices are expected to settle in the coming days.