A major pig iron producer in the Brazilian southeastern state of Minas Gerais is exporting the foundry grade product at $455/mt to $465/mt, FOB port without taxes but Including Pis/Cofins, the same range of one month ago, sources told SteelOrbis, adding that so far in the year it is selling 70 percent of its production abroad, a ratio tending to 80 percent in the last month, comparable to a 50/50 historical average.
Sources blame reduced demand from all domestic industrial sectors for the downturn in local sales, reflecting the lackluster performance of the country’s economy. The few tons sold locally are destined to the foundry industries in the southern state of Santa Catarina, which usually feed the auto and civil construction industries.
The last deal for sale of the foundry grade product in the domestic market was sold by the company at BRL1,300/mt to BRL1,350/mt ($578/mt to $601/mt), against $571/mt to $576/mt one month ago (at abovementioned conditions).
According to sources, the company remains operating at full capacity, reflecting the benefits from its decision to focus on the foundry grade product and on the international market, adding that the producers in Minas Gerais state that are dedicated to the steelmaking grade product are operating at a 30 percent production pace.