China’s continuing interested in basic pig iron (BPI) imports is providing support for suppliers in the global market, especially those having in hand products for closer shipments. Taking into account that most CIS-based sellers are out of the market for now, the Brazilian mills have been receiving orders, though their allocation is also limited to a certain extent.
Although Brazilian suppliers keep voicing $280-285/mt FOB as their official export offers, discounts are still possible to get. A 60,000 mt BPI cargo for early June shipment has been recently sold to China through a trader at $270/mt FOB, which corresponds to slightly above $300/mt CFR, Steel Orbis understands. A week earlier similar lots were closed at $265/mt FOB. Additionally, a 30,000 mt ex-India pig iron lot for May shipment has been sold to China at $295/mt CFR this week.
Traders are increasingly concerned regarding the lack of material in the global market. “I have three bids from China on the table between $298-304/mt CFR, but I am having difficulty in finding support/quantity from producers,” a trading source said. Meanwhile, another trader added, “As Brazilian suppliers are currently the only ones actively offering, it is quite impossible to grab the material from them.”
Hardly any offer is being heard from the CIS as most of the suppliers have closed sales for May production. In particular, Russia’s NLMK is reluctant to start negotiations for June amid the uncertainty triggered by Covid-19. Tulachermet may be out of market for now due to maintenance, sources assume.
The business activity in Europe and the US remains subdued due to the Covid-19 emergency. “Italy is slowly restarting. From this week, several steel producers have re-opened, but any business after the coronavirus outbreak here is still unpredictable,” an Italian source stated. Offers for ex-CIS pig iron have been heard at $310-315/mt CFR Marghera, with no deals reported yet.
Offers for ex-CIS BPI in Turkey have been voiced at $295-305/mt CFR. According to sources, an Iskenderun region-based mill has booked 20,000 mt cargo, May production, from Ukraine at $300/mt CFR.
Taking into account the current development, market insiders estimate offers for ex-CIS pig iron at the range $285-290/mt FOB, while two weeks ago, the sale for ex-Ukraine BPI was made to China at approximately $275/mt FOB.