The pig iron market remains slow, with little activity expected until the IIMA meeting in Spain next week, market participants inform Kallanish.

The sharp appreciation of the rouble has put pressure on Russian steel exporters, forcing them to suspend sales for a few days to observe exchange rate trends.

In Russia, the exchange rate was set at 82.8487 on Thursday, reflecting a 1.7% depreciation from a rouble peak of 81.5018 on Wednesday. Over the last 30 days, the exchange rate fluctuated around 88.429, while over the past 90 days, it was approximately 97.169. This volatility has led producers to temporarily halt export offerings.

“The market is in wait-and-see mode – there’s a lot of turbulence right now with fluctuating currencies, tariffs, and prices. It’s difficult to make offers today when you might regret the price tomorrow, so everyone is staying quiet,” a Russian producer says.

“Most of the pig iron will go to the domestic market. We can sell some there, but we’ll also need to use more ourselves and reduce scrap purchases,” another producer notes. “Special pig iron grades are holding up well at around $410/t fob Novorossiysk.”

On Monday, Russia’s Severstal was in the Turkish market offering basic pig iron at around $355/t cfr, while other suppliers were at $370-375/t cfr, according to a Turkish trader. These offers were no longer available by midweek.

The currency situation in Turkey – Russia’s main pig iron market in absence of the EU due to sanctions – was the opposite of Russia. The lira fell sharply on Wednesday morning after President Erdogan stunned markets by arresting Istanbul's mayor, Ekrem İmamoğlu, a top contender for the presidency.

While some suggested this could temporarily distract Turkish imports while boosting exports, others saw no impact on raw material purchases. “All our [EAF mill] costs are in dollars – only 1-2% of labour costs are in Turkish lira. Slab, billet, scrap, natural gas, and electricity are all linked to USD,” a Turkish producer source notes.

In the EU, the consensus was that among alternative suppliers – Ukraine, Brazil, Indonesia, India, Vietnam, and Malaysia – Ukraine would take over Russia’s market share.

“I heard Italy is at $420-425/t cfr for non-Russian material, but the main Italian buyer is sitting on around 400,000 tonnes of Russian pig iron,” a source reports.

In India, one of the available markets for Russian producers, the rupee appreciated against the dollar, reaching 86 this week compared to 88 nearly two weeks ago. Although this could create a more attractive environment for imports, no firm prices have been heard in the market.

In the USA, “Brazil recently sold at $475/t cfr last week, with some sellers now aiming for $500/t cfr.”