Trading activity has been slightly slacker in the Brazilian basic pig iron (BPI) export market compared to a week ago. However, a few more deals have confirmed the previous higher level. Meanwhile, suppliers hope for a further increase since, after months of high supply and low demand in the US, the situation has changed to the opposite.
A contract for 50,000 mt of ex-Brazil BPI with 0.15 percent phosphorus content has been signed at $435/mt FOB for April shipment, translating to $460/mt CFR New Orleans. Last week, two deals from another mill were signed at $431/mt FOB, excluding $4/mt financing. Some market sources reported two new deals instead of one, but this could not be confirmed by the time of publication. “Some customers are looking for earlier shipment (March), but it is not available,” a trader said.
Local scrap in the US Midwest is expected to increase by $30-40/gt ($30-41/mt) in March and some market sources believe a hike of up to $50/gt is possible. This is going to keep supporting the pig iron prices and some Brazilian sellers are aiming to get at least $440/mt FOB for BPI in the next round.
The reference price for import pig iron in the US has remained stable this week at $460-470/mt CFR as the higher end represents the tradable level for low-phosphorus BPI. Also, ex-Ukraine low-manganese pig iron could be traded at $465-470/mt CFR.