Merchant pig iron trading activity has switched from Brazil to the Black Sea in the past week, amid an ongoing push by producers to achieve higher prices. The past week has also brought the first April sales of CIS material to the US, priced at the lower end of market participants’ working price assessment last week, Kallanish notes.
A Ukrainian cargo was booked at $575/tonne cfr Nola, for late-May shipment, late last week. Negotiations for the cargo started much earlier, and subsequent deals are expected at higher prices, in line with the US scrap market’s upward direction, sources say. Offers to the US from another, Russian supplier remain at around $600/t fob Black Sea, while another Russian supplier names $550/t fob as a working price level this week, with price hike potential growing.
In the Mediterranean, both Turkey and Italy have continued to book pig iron, with a total of around 50,000 tonnes sold in the past week. A total of 11,000t of Ukrainian pig iron was booked in Italy at around $585/t cfr, netting back to around $560/t fob. Demand in Italy has shrunk in the past year as mills have used a greater scrap proportion in their charge. Mills typically buy a few thousand tonnes at the most in ports, save for those who have long-term contracts with Russian suppliers.
Turkey, despite booking what now looks like two Brazilian cargoes in the past two weeks, was also in the market, booking a small Russian cargo at $565/t cfr. A total of around 25,000t was booked by a stockist at around the same fob price level of $545-550/t for May shipment.
There were also higher-priced foundry grade medium and small pig iron lots booked in Europe and Southeast Asia at a higher price level, estimated at around $580-585/t fob, including quality extras.
Market participants expect more CIS sales to the US in the coming weeks, as Brazilian availability appears to have dwindled with no offers seen in the market in the past week. China remains out of the market, but despite its absence, the price of CIS BPI continues to creep up.