Prices for ex-Brazil basic pig iron (BPI) have stabilized in the last two deals done to the US last week and this week. Most market sources believe that prices for imported pig iron in the US may be at the bottom now, but the possibility of a rebound in July is very uncertain with forecasts for the US scrap market still bearish, but there are also some fears that Brazilian mills may choose to cut production, SteelOrbis has learned from the market.
A deal for 30,000 mt of ex-Brazil 0.15 percent phosphorus content BPI was done to a major US steel producer at $420/mt FOB yesterday, translating to around $445/mt CFR or just slightly higher. This price is in line with last week’s booking of 30,000 mt from the same Brazilian producer to the US. Before these two deals done over the past two weeks, prices were already at $420-424/mt FOB in the two previous bookings, meaning that the market has stabilized and prices are unlikely to fall further. “Suppliers see the bottom at this level now. US buyers have failed to get lower,” a trader said.
Though prices have stabilized, a rebound in July is questionable with the expectation for domestic scrap prices in the US to go down further. “It [rebound] will depend on [Brazilian] producers. If some of them stop the furnaces, it is quite possible,” a source said.
Also, offers for ex-Ukraine BPI have been heard at $470/mt CFR to the US over the past two weeks, with no confirmation of a deal done, with some sources saying that the level is high for the US, but low for the Ukrainian mill, taking into account production challenges and transportation costs.