The Brazilian pig iron export market began heating up early February, with demand, mostly from the US, foreseen to jump 15% this year, market sources said Friday.
Sources view the market optimistically, unlike the start of last year, and they are seeking a diversification of exports.
High Brazilian taxes have made it difficult for exporters there to be competitive in international markets, market sources said.
"Brazil is getting more aggressive -- although its competitiveness is not very evident yet, it's a great improvement. It's hard to be competitive in Brazil when you have a heavy tax burden and an intense movement of the foreign exchange (dollar vs. Real) rate," said a source.
The US remains the largest importer of Brazilian pig iron, but Europe is importing the raw material in large quantities, followed by other Latin American countries and Asia, except China.
"There's a better distribution of the exports and a lower dependence on the US now. Russia was very aggressive exporting the raw material, but this situation has not harmed us in terms of price or quantity. Moreover, they have a lower cost in the production of the raw material," the source added.
A second source also believes the market is getting better, although no closed deals were seen, only offers. "I've heard about some pig iron negotiations from southeast of the country at $365/mt FOB."
S&P Global Platts assessed the weekly Brazilian export basic pig iron price stable at $372.50/mt FOB, southeastern ports, Friday based on a $370-$375/mt range.
