Pig iron prices remain strong despite few sales concluded lately
The CIS pig iron export market has turned to Asia after the US booked a Russian cargo
at the equivalent of around $360/tonne fob Black Sea ten days ago. But despite
considerable interest from China returning, none of the CIS mills were able to trade due
to their high expectations, traders say.
According to Kallanish price series, the market remains firm, just below the record level
of $365/t FOB CIS registered at the end of September.
Indeed, the sale to the US earlier in mid-October has sufficiently emboldened suppliers
to offer at a minimum of $360/t fob Black/Baltic Sea, for remaining December/Januaryproduction volumes. As bids from China are still in the region of $383-387/t cfr,
depending on the origin, this level is not workable especially with traders' involvement.
Nevertheless, some sources expect China to table firm bids at $390/t cfr this week amid
ongoing tightening of environmental restrictions.
Thus far, smaller higher-grade shipments are working better, with another 10,000-tonne
Russian low phosphorous parcel sold to Taiwan at $392/t cfr for February arrival. This
was dispatched from the Russian Far East, with freight unlikely to exceed $15/t, traders
The on-going interest from China did result in a Brazilian sale, however, of a combined
cargo from the south at $355/t fob and marketed at $390/t cfr in China. Traders expect
the sale at $385/t cfr would be very easy to achieve now, and a little higher next week.
This is despite increasing recognition that a second Covid-19 wave in some regions
could result in lockdowns that limit industrial activity.
Already some European products are reacting to these fears, especially in the
construction industry, sources note. This has not affected demand thus far, but should
more restrictions be implemented, there could be a deeper winter price correction than is
Meanwhile, with scrap rising in major importing regions amid the same fears of low
supply, the majority of participants see the CIS pig iron export market as well balanced
and stable. There is just enough availability of material to satisfy current levels of