The strong rebound in the scrap market in Turkey is expected to provide some support for ex-Russia basic pig iron (BPI) prices since, after filling their quota in Europe, Turkey, the Middle East and India have become the main sales destinations for Russian suppliers.
In the Turkish market, the latest confirmed deal for US scrap has confirmed that shredded scrap has reached $408/mt CFR. In such conditions, market sources believe that buyers may accept $390-400/mt CFR for Russian pig iron, which is equivalent to $370-380/mt on FOB Black Sea basis. “We are targeting an increase, but there has been no deal yet to confirm a new level,” one seller said. Last week, a deal for Russian pig iron was heard to have been signed at around $370/mt CFR.
There have been no fresh sales reported to the Indian market and it seems that the seller, which gave an offer at $370/mt CFR last week, may increase it to $390/mt CFR, following some rises in the local steel market in India. However, market sources report that anything above $390/mt CFR, translating to around $350-355/mt on FOB Black Sea basis, is unlikely to work out.
In Europe, large buyers’ price ideas for import pig iron are at $400/mt CFR, stable compared to two weeks ago. The lower bids at $390/mt CFR heard last week did not result in any serious negotiations. The highest price for pig iron for foundries has been heard at $420/mt CFR. “The market is very weak as there is no movement in finished product prices and mills are reducing production,” an Italian source said.
The SteelOrbis reference price for ex-Russia BPI has settled at $350-380/mt FOB Black Sea with the midpoint at $465/mt FOB, moving up by $15/mt on average over the past week.