Ex-CIS pig iron prices rebound in deals to US and EU, after sales to China

Wednesday, 23 October 2019 17:59:48 (GMT+3)   |   Istanbul
       

CIS-based pig iron exporters have seen some significant rebound in their workable prices owing to higher demand in traditional outlets, following strong sales to China.

China has been active in pig iron purchases in October. According to sources at least 400,000 mt were purchased from the CIS though some estimate the volume at over 500,000 mt. “China has booked a lot of pig iron from the CIS. Almost everyone has sold two cargoes each,” a source mentioned. The majority of sales have been reported at around $320-325/mt CFR and above. Currently, buying activity has slowed down somewhat, with the firm bids from traders coming at $315/mt CFR. Freight to China from the Black Sea is estimated at $47-50/mt.

The strong sales to China have supported the positions of the CIS-based mills in their talks with the US and the EU. As a result, US buyers have purchased 100,000 mt from Ukraine at $310-315/mt CFR, though earlier the bids were far below $290/mt CFR. Negotiations with other sellers continue within around $305-310/mt CFR, SteelOrbis understands.

In Italy, some sales were reported at $303-305/mt CFR at the end of last week. In addition, both sides are currently negotiating at $310-315/mt CFR and above, and new deals are expected shortly.

Turkish buyers have been mostly seeking to buy at $290-295/mt CFR though they are having trouble finding this level on the suppliers’ side. However, an agreement at $303/mt CFR was reportedly closed last Friday with a Ukrainian seller. In addition, a 7,000 mt lot of casting pig iron was sold at $320/mt CFR Turkey for delivery in the second half of November.

As a result, the workable price level for the ex-CIS pig iron has moved up by $15/mt since early last week to $285-290/mt FOB. According to the mills, the November pig iron allocation has been used up and some December volumes have already been marketed in recent deals.


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