Ex-Libya mill sells decent volumes of HBI amid expected price increase

After a long pause, the Libyan mill has entered the export market with decent volumes of merchant HBI and has managed to sell them at a higher price level. This increase has been expected in the market amid a general shortage of HBI in the global market, and emerging demand from the GCC as this region has been hit hard by the war.

According to different sources, a number of lots of 20,000-40,000 mt have been sold to traders at the price of around $370/mt FOB. Among the trade destinations mentioned have been Saudi Arabia, Egypt and Europe, but market sources agree that since the sales volumes in total were up to 100,000 mt or even above, there can be more countries as final buyers. “Tonnages were sold all around, including Europe,” a trader confirmed.

One of the big lots of 40,000 mt has been discussed as being sold to Saudi Arabia and the price has been heard even slightly above the level mentioned earlier, but there has been no final confirmation from the buyer’s side by the time of publication. Even though Saudi Arabian buyers can use their ports, which are in Red Sea and are not blocked, unlike other GCC countries like Qatar, Kuwait, Bahrain and partially the UAE, suffered by the blockade of the Strait of Hormuz, mills there also feel disruptions in production of own HBI. In particular, Foulath Holding declared a state of force majeure in late March, and even though it announced the resumption of operations a few days later, in general the utilization rates are reduced inside the group, and logistics have remained very challenging. Foulath Holding is the parent company of Bahrain Steel, which has a 12 million mt pellet capacity and usually serves demand for pellets in Bahrain and across the whole GCC region.

In Europe, market sources confirm that new offers in the market have been heard at $400/mt CFR or higher, which is $10-15/mt higher than the previous traders’ offers. “It is too high in my opinion, on top of the CBAM default value,” an Italy-based source said.

In Turkey, buyers have also been resisting accepting higher offers at $400-405/mt CFR. Even the previous level of $380-390/mt CFR from some sellers has been assessed as high, and most large buyers, who can buy Russian pig iron, have been bidding for import HBI at hardly above $370-375/mt CFR.

The SteelOrbis reference price for import HBI in the Mediterranean has been settled at $390-400/mt CFR, increasing by $5/mt over the week.