Sentiments in the Russian basic pig iron (BPI) market have worsened over the past week as some discounted deals have been done by sanctioned Russian mills to the MENA region, while rising freight rates have been adding to the situation.
A lot of BPI from Donbass, the Ukrainian territory occupied by Russia, with the occupation not legally recognized by the world and where plants are sanctioned, is heard to have been sold at $337/mt FOB, with the sales destination being Turkey and the CFR price assessed at not above $365/mt CFR. Market sources assess the freight at $28-30/mt for smaller and medium lots, while for large cargoes it is around $24-25/mt. Before the surge in oil prices, freight from Russia’s Black Sea ports were ranging at $20-25/mt. “I would say CFR prices are stable in the region, so FOB levels need to slide,” a market source said.
In general, Turkish buyers have been targeting $360-365/mt CFR, but, with no offers at such levels from non-sanctioned mills, they have opted to buy from Donbass. The non-sanctioned mill has stopped offering officially as its previous targets at $350-355/mt FOB are no longer in line with current market conditions.
One non-sanctioned supplier has been in the market with an offer at $380/mt CFR in Turkey, translating to $350/mt FOB.
In addition, up to 30,000 mt of ex-Russia BPI are heard to have been sold to the MENA region at $370/mt CFR, with the freight estimation from the Black Sea at above $30/mt.
The SteelObris reference price for ex-Russia BPI has settled at $337-345/mt FOB Black Sea, with the midpoint at $341/mt FOB, down by $6.5/mt on average over the past week.
