While CIS-based basic pig iron (BPI) producers largely continue to maintain a wait-and-see stance, closely watching developments in the global scrap and finished steel markets, suppliers of ex-Brazil BPI have proceeded with fresh negotiations with US customers.
Accordingly, SteelOrbis has learned of a new booking of ex-Brazil BPI, done at the same price as the 35,000 mt lot sold last week by another Brazil-based supplier, namely at $480/mt FOB south coast of Brazil, also to the US, for March shipment. Though the exact volume of the new booking remains undisclosed at the time of publication, according to market sources, it may have been a mixed 65,000 mt cargo from a Brazil-based supplier and the international trader who purchased the material earlier as a position. Meanwhile, the freight rate for shipments in March has remained a complex and a sensitive matter. While some market sources state that transportation costs from the south of Brazil to the Port of New Orleans have increased at least to $27/mt, other market participants find it hard to believe they are higher than $20/mt. Consequently, amid the above circumstances, SteelOrbis’ assessment for BPI prices in the US is around $500-510/mt CFR Port of New Orleans.
“I got curious why CIS-based suppliers keep sitting with material in their hand. If scrap is at $405/mt CFR now, pig iron will be $450/mt FOB pretty soon,” an international trader commented with regard to the abovementioned deal. “Following a bid at $420/mt FOB, the Indian supplier countered his offer to $465/mt FOB, but buyers rejected it. Everything signals that buyers will only exert their pressure in the coming days. I am waiting for a 7-10 percent drop at least,” he added.