While import scrap prices have been following a downtrend and demand for pig iron is still at low levels, CIS suppliers have been forced to drop their pig iron offer prices sharply, which, nevertheless, has failed to increase buyers’ interest in purchases so far.
According to market sources, over the past week ex-CIS pig iron offer levels have decreased by $17.5/mt on average to $300-310/mt FOB. Moreover, “there are also a few offers below $300/mt FOB,” a source told SteelOrbis. Such a sharp decline has been inevitable due to the fast decrease in scrap prices in Turkey, which have dropped by an additional $9/mt this week and have touched their lowest level since January 2017.
Moreover, weak demand in the global market has hit suppliers’ positions. According to market sources, trading activity in the US market, one of the major sales destinations for CIS exporters, has been close to zero recently.
In addition, the decline in iron ore prices has been not so sharp compared to the decrease in the scrap segment, and so pig iron producers have been in a less favorable position.