European consumers refrain from purchases of pig iron in spite of rapidly growing cost of ferrous scrap. The steelmakers are reluctant to run the risk of buying expensive material amid an upturn in prices in the segment for scrap, which seems short-lived to them. European market participants anticipate that quotations of scrap will roll back in February already. Consumers of pig iron are expected to return to the market for restocking in late January and thus steelmakers have decided to delay purchases until the situation in the segment for scrap becomes clearer.
At the moment, prices for pig iron and high-quality scrap are almost on the same level and some mills are purchasing small batches of the former in the domestic or stockists' market, due to the short delivery time and deferred payment option available. Exporters of pig iron have announced an increase in their quotations after selling small lots of the material at higher prices, and are planning to lift them further.
Market participants inform that some Russian suppliers have sold a small pig iron lot of 3,000 tonnes from Ust-Luga Baltic port at $530/t FOB ($545-550/t C&F ports of Northern Europe). Previously, the transaction prices were at $495-500/t FOB ($520-525/t C&F ports of Spain).
And though new prices have not yet been supported by large contracts, exporters have raised their offers to $560-570/t southern ports of the EU. Currently they have not many arguments to justify their increase, as February production of the material has not yet been sold-out and there are substantial amounts of unsold pig iron available in ports.
Due to this, not all the Russian suppliers stick to upward trend. A contract for low-quality pig iron has reportedly been signed recently at $500/t FOB.
Ukrainian pig iron is available at $495-500/t FOB Black Sea, and there has been a deal reported at this level. The material will be shipped to Belgium, with C&F-price being $540/t.
No comments:
Post a Comment