Isolated from traditional markets due to the sanctions imposed by the West, Russian basic pig iron (BPI) producers have remained highly aggressive in their offerings when searching for customers. Following a transaction done to China last week by Russia-based Severstal at $560/mt CFR last week, Russian BPI suppliers have decreased their offers to China to $530-535/mt CFR. Meanwhile, BPI produced by Russia’s Ural Steel which was said to have been offered to Italy at $700/mt CFR earlier is now possible to book at $620/mt CFR. “They appear to be not under sanctions, as the mill belongs to Zagorsky Pipe Plant (ZTZ). However, even given that, there are not so many who want to touch them,” an international trader stated. Offers of ex-Russia BPI to Europe at $650/mt CFR are said to be more widespread.
By the middle of the current week, the information about a booking of BPI produced by Donetsk Metallurgical Plant, which is located on territory temporarily occupied by Russia, has been leaked to the market, though it has not been confirmed by the time of publication. The material is reported to have been booked at $500/mt CFR to Turkey. “It could easily happen. Last week, they were ready to sell at $500/mt FOB,” a reliable market source stated. Nevertheless, some traders doubt that such low levels were possible to get from the supplier. Furthermore, Russia-based BPI producer NLMK is reported to have sold a cargo of BPI, also to Turkey, at $520/mt CFR, down $20/mt from the levels initially targeted in offers to this region. “Turkey is almost the only market buying volumes from Russia, and so it is able to exert pressure as much as it wants,” an international trader commented.
Other global BPI suppliers have maintained their attempts to prevent prices from decreasing, though it is getting more and more complicated, given the availability of low-priced offers from Russia and, in general, the mounting bearishness in the global steel market.