In the pig iron markets, although pig iron suppliers from the CIS have been seeking to keep their offers firm, the scarcity of scrap transactions in Turkey may prevent them from doing so. In the meantime, it is thought that the strengthening of demand in the US as of late March may start to affect the raw material market soon, and this may be advantageous for Brazilian pig iron suppliers.
As regards the market for iron ore - a key cost factor in pig iron prices; SteelOrbis has learned that in February this year Brazil's iron ore exports increased by 2.38 percent month-on-month, reaching 23.28 million mt - slightly down by 0.62 percent as compared to February 2010. On the other hand, a rumor concerning a possible lifting of duties in India for iron ore exports is being closely followed by market players. However, no official announcement has been made so far by the Indian authorities.
In the Turkish domestic market, as SteelOrbis previously has reported, by the end of April commercial pig iron production and sales in Turkey's Iskenderun region will be halted. Accordingly, Turkish foundries are looking for alternative pig iron supply channels. Considering the increased foundry capacities, it is foreseen that Turkish foundries will seek to import pig iron. In the meantime, it is reported that trading companies in Turkey have continued to sell ex-stock pig iron to the foundries.
In the Ukrainian market, a likely key supply channel for Turkish foundries, a steelmaker has sold approximately 15,000 mt of basic pig iron from its April production via tender at $510/mt FOB. It is reported that, initially, the offer level of the steelmaker was at $530-540/mt. The reduction may be attributed to the reluctance of buyers, arising from their doubts as to whether demand will strengthen in the coming period.
Russian pig iron suppliers are trying to maintain their export offers at $530-540/mt FOB; however, for high volume bookings lower prices are also being tested.
Finally, the strong trend lately seen in Turkish flat steel prices is causing pig iron suppliers to shift their focus more towards flat steel producers.