Prices for ex-Brazil basic pig iron (BPI) have moved up over the past week, but active negotiations and recent sales have still been focused on the US market, where supply of metallics has been rather limited so far. Expectations for ex-Brazil sales to Europe are still positive, though for now this outlet has been rather quiet, at least as regards sales of basic pig iron.
A deal for a large vessel of BPI from Brazil with 0.15 percent phosphorus content has been reported at $415/mt FOB this week, which is up by $5-10/mt from the reference seen a week ago. This cargo is for the US market with the CFR price confirmed at $440/mt CFR. US buyers have accepted some gradual increase as there has been rise in local scrap prices for January, while overall supply of pig iron has mainly been only from Brazil, with no firm offers from Ukraine or India at the moment. “Basic pig iron producers are asking for $420/mt FOB, but, in reality, prices could be at $410-415/mt FOB,” a trader said. One Brazilian source also added that prices are supported by the expected strong demand from both the US and Europe and “due to heavy rains”.
The reference price for ex-Brazil BPI with 0.15 percent phosphorus content has added $5/mt to $410-415/mt FOB. The tradable level for BPI in the US has settled at $440-445/mt CFR, up by $6.5/mt since late December.
At the same time, there have been no reports of ex-Brazil BPI deals to Europe, with some rare offers increasing to $445/mt CFR aat the lowest. “Everyone is confused about what new prices to offer, considering CBAM costs, and regulations are not all clear and not fully official, but it’s in place. I see a bit of chaos in the market due to that,” a Europe-based source said. Ukrainian mills have not issued new offers due to blackouts in the country and problems with transportation, while their previous offers were at $430-435/mt CFR. Some sources believe that new offers should be at $440/mt CFR. CBAM costs for Ukrainian mills are assessed from €50/mt to €80-85/mt, depending on emissions.
Though the basic pig iron segment has been quiet, some higher grades are heard to have been sold. Some sources heard about sales from Brazil at $430-435/mt FOB, but “it was low phosphorus material like P 0.05 percent max,” one of the sources said. A European source commented that this price, which will translate to $470-475/mt CFR, excluding CBAM costs (that should be very low), is tradable for semi-nodular pig iron.
