Higher offers voiced by Russian basic pig iron (BPI) exporters earlier have failed to work out and the market has closed for holidays, awaiting the trend to settle after the New Year holidays.
The SteelOrbis reference price has been settled at $315-335/mt FOB Black Sea with the midpoint at $325/mt FOB down by $10/mt from $320-350/mt FOB last week.
Most offers seen at $345-350/mt FOB last week have failed to work out and the real market level has been considered at a much lower level with inactive market conditions at the major sales destinations. There has been no definitive price in the major European import market as the quota will be opened on January 1. “There is no price as there was not a single deal in the Black Sea market. If the sales will be based on formula [calculated from the news agencies’ indexes], the real price for the material to be arrived in January will be rather low, lower than the major mill targeted,” he added said. Based on the secondary market sales in Europe, Russian sellers have been aiming $370-380/mt CFR, translating to $340-350/mt FOB, but the large buyers’ price ideas have been at $350-360/mt CFR or $320-330/mt FOB as the highest.
The question is what will happen with FOB BPI prices in Q1 after the filling of Russian quota, which is 700,000 mt versus 1.14 million mt for 2024. Though the logical result of it should be a sharp hike in prices, some market participants are cautious about this. “I don’t see the scenario when after quota filled [expectedly in February], price will increase immediately as these tonnages need to be consumed, and producers will wait,” a source said.
As for the Turkish market, the offer price level has been at $340/mt FOB, or around $360-365/mt CFR, but no deals have been confirmed so far. Market sources said that with the absence of trades at the regular sales destinations, mills that are eager to sell will have to give $315-320/mt FOB at least to trigger interest in such weak conditions. Russian mills will restart official work after January 8. There has been a rumor about a trade at $335/mt FOB for low-manganese BPI, which is equivalent to $325-330/my FOB for base.