US pig iron import prices moved higher on Feb. 4 on stronger Black Sea prices and a deal out of Brazil, even as domestic scrap prices dropped.

The weekly Platts US pig iron import assessment increased by $12.50 to $547.50/mt on a CIF New Orleans basis.

One cargo from Ukraine was bought at $550/mt CIF New Orleans. The price was similar to recent FOB Black Sea prices in the region with some market participants questioning current pricing.

“Difficult to understand this level FOB and have the same CIF US,” said one European mill source.

One CIS supplier offered 50,000 mt at $620/mt CIF US but for May shipment. A trader suspected the maximum they could get would be $550-$560/mt CFR US.

Platts assessed CIS export pig iron at $545/mt FOB Black Sea Feb. 4, up $7.50/mt on week, amid reported mill sales to traders at $540-$550/mt FOB on Jan. 28 and early the week started Jan. 31. Some CIS mills even cited reported deals at $560/mt FOB, but buyers in Europe cited workable levels for CIS pig iron at $550/mt CFR Italy, highlighting the wide regional pricing disparity.

In addition, there was talk of another US buyer placing an order out of Brazil at $505/mt FOB which normalizes to around $542-$545/mt CIF New Orleans based on $37-$40/mt freight.

The higher pig iron prices come as the US domestic scrap market is seeing mounting pressure on prime grades of scrap for February deliveries. Initial mill bids in the Midwest started on Feb. 3 at a $35/lt discount to January prices.

One Midwest scrap supplier said he thought No. 1 busheling prices could find a floor at $500/lt on a delivered basis given the higher pig iron costs and some consumers looking to add tons to February orders. The move signaled buyers were sensing an opportunity to increase prime scrap inventories at the possible price floor, according to the supplier.


-- Michael Fitzgerald

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