Following the rapid downtrend in the steel market in China, which ultimately has led to increased uncertainty among steel market players globally, CIS-based suppliers of basic pig iron (BPI) have preferred to cut their prices. Consequently, at least two CIS-based producers have managed to sign contracts with their traditional customers located in the US.
Accordingly, by the end of last week a Russia-based producer sold a BPI cargo to the US at $665/mt CFR Port of New Orleans, for June shipment. Concurrently, an ex-Ukraine BPI cargo was booked to the US at the same price, SteelOrbis has learned. Taking into account the likely freight charge at $30-35/mt, the FOB-based price is estimated at $630-635/mt FOB, while initially the suppliers were aiming to get $650/mt FOB at least, with some of them actively even voicing $700/mt CFR Port of New Orleans. “With global steel prices expected to tumble soon, to sell BPI at $665/mt CFR now seems to be the right decision,” an international trader stated. “It seems that China has overreacted. The price idea today for pig iron is $530/mt CFR,” another international trader commented with regard to the current situation.
Meanwhile, ex-Brazil BPI offers have been heard at $620-635/mt FOB, for July-August shipment. As SteelOrbis reported previously, the most recent ex-Brazil BPI deal was done to South America at around $700/mt CFR, with the FOB price being assessed by market insiders to be about $660-670/mt FOB Brazil.