Prices for ex-Brazil basic pig iron (BPI) have stopped falling further and most market sources believe that the current price is the bottom level for January, considering the higher local scrap prices in the US and the resistance of Brazilian suppliers.
In particular, US buyers’ price idea for BPI with 0.15 percent phosphorus content has slipped to $390/mt FOB, versus the previous deal at near $400/mt FOB reported a week ago. However, the bid at such a low level has been strongly rejected by the exporters from Brazil. “Now with the $20/mt higher [local] scrap price [in the US] and the hope of support from Mr. Trump regarding the import duty on Canadian scrap, I guess there is currently no space for a further decrease,” a market source commented. Also, one of the Brazilian sources agreed that this is a bottom price level as “we still have two or three months of rains ahead of us and nobody can guarantee the exchange rate will remain at the current levels (above 6.00 over the past few weeks).”
The SteelOrbis reference price for ex-Brazil BPI with 0.15 percent phosphorus content has settled at $400/mt FOB, versus $395-400/mt FOB last week. Also, the reference price for imported BPI in the US (including low-phosphorus material) stands at $425-440/mt CFR.
At the same time, the negative mood in the Russian BPI market has persisted. Suppliers have not fully resumed work due to the holidays, but buyers have been insisting on lower prices. Negotiations for the 2025 quota in Europe have resumed, but large buyers have cut bids from $350-355/mt CFR seen in late December to $340/mt CFR, which translates to $310/mt on FOB Black Sea basis. “Most mills are not going to sell at the current [asked by buyers] prices,” a trader said, adding that the mills are not giving any offers but are sending cargoes anyway and will sell them under the new quotas. The levels targeted by major Russian mills have been at $335-340/mt FOB Black Sea at the lowest.
In the Turkish market, after the recent decline in scrap prices, the tradable level for import pig iron was at $340-350/mt CFR at best, translating to $320-330/mt FOB and slightly lower for small volumes. “Turkey is better in terms of prices, but there are problems with shipments from Novorossiysk,” a source said, adding that no fresh deals have been heard so far.
The negotiations with Indian buyers have been halted and market sources believe that they will target below $300/mt FOB from Russia.
The SteelOrbis reference price stands at $300-330/mt FOB, with the mid-point at $315/mt FOB Black Sea, versus $310-335/mt FOB last week.