Posted on 01 Apr 2022
The merchant pig iron market has quietened down in the past week amid ongoing price rises and lengthening lead times. Russian suppliers' difficulties in shipping contracted material also weighed on buyers' readiness to commit to purchasing, but some Russian tonnage was sold to the Mediterranean, Kallanish learns from market sources.
US buyers stepped back from the market in preparation for April domestic ferrous scrap settlements, which are expected to be higher on-month, and the absence of Brazilian availability before August load readiness. Offers from India, coming up to $1,000/tonne cfr Nola, did not gauge interest either, while some contracted Russian material was heard delayed by vessel procurement difficulties for a long-term formula-based contract delivery. This tonnage was heard resold in the Mediterranean.
Rumours of a Chinese pig iron cargo being sold sometime in first half of March at $1,000/t cfr Nola could not be confirmed by press time. Traders however say it was possible, as they were expecting pig iron prices to shoot up amid CIS material absence. No other Chinese material sales were heard in the past week, although soft offers were present in the market, but did not conclude in sales.
Brazilian material is indicated at up to $1,100/t cfr Nola for August loading, but did not move past this level, traders note. More Russian material was also offered at $1,000/t cfr, but yet again, buyers were reluctant, feeling the bite of financial sanctions, and not willing to commit at this point, They are also aware of ongoing problems Russian suppliers are facing with vessel allocations, amid the international shipping community’s general refusal to work with Russian mills.
Some Russian pig iron found its way to Italy, where prices continue to rise, topping $950/t cfr this week (see separate article). Late last week, around 15,000 tonnes of Russian mixed prompt material, likely from the US-bound undelivered contact, was sold to Italy at $850-900/t cfr, for BPI and nodular grades. This is considerably up on previous offers at $830-850/t cfr Italy and Turkey, seen the week prior, but the prompt dispatch added value to the price, along with rising freight rates, a trader explains.
Demand in Turkey has cooled after the flurry of purchases in the first half of March, and amid the country's preparations for Ramadan. Scrap prices are relatively stable and Turkish buyers are also watching US scrap price settlement, having stocked up sufficiently for ongoing needs, a scrap source confirms.
Source:Kallanish
