Ore-based metallics prices rose slightly outside of the EUtitle

Pig iron prices rose m/m in all major regions aside from Europe on improved buying. Demand in the US remains robust while market participants report that availability of Brazilian material increased after tightening a month prior. Meanwhile, Ukrainian export capacity increased due to greater access to temporary sea corridors.

In the CIS, pig iron prices increased $10 /t m/m to $395 /t FOB Black Sea. Ukrainian pig iron exports also increased as Ukrainian exporters now have better access to temporary sea corridors. However, freight rates rose in early December due to shipping disruptions caused by a spate of attacks on cargo vessels near the Suez Canal and a drought in the Panama Canal. This freight market disruption has eased in the past few weeks. Meanwhile, heavy congestion was being reported at land borders between Ukraine and the EU, driving exporters to utilise maritime shipments due to their increased export capacity.

Following a decline in November, Russian exports of merchant pig iron increased in December as higher scrap prices made Russian pig iron more lucrative for buyers. Market participants report that demand for Russian material increased in early December, though deteriorated in the latter half due to the holidays.

In Europe, Italian pig iron price was unchanged m/m at $425 /t CFR due to a slow start to business activity in 2024 following Christmas and New Year holidays. Moreover in December, the European Union imposed the 12th package of sanctions against Russia, which includes restrictions on Russian pig iron imports into the EU to 1.14 Mt in 2024, 700kt in 2025, and a complete prohibition in 2026 (see chart).

Meanwhile, pig iron prices in the northern and southern markets of Brazil increased by $15 /t m/m to $480 /t and $450 /t FOB respectively. Despite the rise in prices, increased cost of charcoal due to heavy rainfall in the Southeast region of Brazil put downward pressure on producer margins.

In the USA, pig iron prices increased $20 /t m/m to $500 /t CFR NOLA, in line with the historical average premium to scrap prices. Buyers report that supplies from both Brazil and Ukraine have increased even as demand remains strong, though buyers remain reluctant to rely on Ukrainian material due to risks associated with the ongoing war.

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