Rising raw material prices lead to higher prices for pig iron

Commercial pig iron prices have risen over the past week, fueled by higher prices for iron ore, scrap and finished goods.

While activity remains subdued, China's strong interest in imports inspires confidence in sellers to boost supply, while alerting some former fence-sitters to act. This led to several sales at prices higher than last week.

Higher sales activity was noted in the Western Hemisphere, while CIS suppliers maintain higher offerings. Several Brazilian shipments were sold last week at prices starting at $ 580 per tonne in southern Brazil for two shipments of 30,000 tonnes each for a trader and a Turkish steel mill for loading in mid to late summer. Another supplier sold the batch to a trader for $ 590 per ton fob. This was followed by an increase to around $ 640-650 per tonne in the middle of the week amid low availability and rising domestic demand amid continuing price increases throughout the value chain.

US buyers remain in the shadows and only two deals have been announced: one from Brazil at $ 620 per tonne of nola at the end of last week, and the other at $ 630-635 per tonne of nola this week. Market participants believe that US buyers are accepting the new paradigm of higher prices, and Chinese demands are pushing them to purchase materials. Several buyers have expressed interest in a price of $ 640-650 per tonne nol for the LPG material, but no deal has been heard.

Meanwhile, sellers from the CIS countries indicate prices in the range of 640-700 dollars per ton on the Black Sea market. At the end of last week, Ukrainian pig iron was purchased from Italy at a price of about $ 635 per ton fob. Since the sale ended before the iron ore and scrap price gains last week, this price is no longer available.

Participants agree that as the prospect of China entering the market grows, buying activity will increase. Currently, prices are quoted according to US buyers - about $ 650-660 per tonne cfr, this destination remains uninteresting for both CIS and Brazilian producers, but last week Indian material was sold to China at a price about $ 580 per tonne cfr. Traders acknowledge that more Indian pig iron will be sold to China this week at higher prices.