Expectations involving the return of China's appetite following the Lunar New Year Holiday and geopolitical and short-supply pressures involving Russia and Ukraine have pushed offer levels up for Brazilian exports of pig iron, according to market sources.

S&P Global Platts assessed the weekly Brazilian export pig iron price up 2.5%, or $12.50, to $512.50/mt FOB on Feb. 4, after advancing 0.5% the previous week already under the influence of Chinese buying expectations.

The higher range of $510-$515/mt FOB was based on most repeatable deals, offers and bids reported during the week.

For a local trader, market information is confusing and pressuring new highs.

"Last week there was a sale to the US at $500/mt FOB. Almost automatically a trader came to the market paying $510/mt FOB. And now I hear they are in the market buying at $520/mt for March shipment," he said.

Nevertheless, a second trader added that producers are dealing with a falling exchange rate and rising costs of charcoal and iron ore, signaling additional pressures on pricing.

A European trader said pig iron prices are advancing mainly due to a material shortage from Russia and Ukraine.

Another source in Europe said there is only one mill in the market there offering pig iron, and Turkey is the demander of the moment. “So not surprising they offer $550-$560/mt FOB,” he said.

The first said that demand is mainly from Italy and Turkey now, with tradable levels at about $530-$535/mt FOB.

American buyers remain purchase-shy as the US domestic scrap market is seeing mounting pressure on prime grades of scrap for February deliveries.


-- Mayara Baggio

steel prices | « back

© Steel Business Briefing 2023