Platts – Venezuelan hot-briquetted iron export prices have fallen sharply as buyers continue to be scarce in the global market, sources said Friday.
One source at Briquetera del Caroni’s (BriqCar) said he sold around 20,000 mt of HBI in late February to a European buyer at $190/mt FOB, but its offer started at $265/mt.
“BriqCar produces with intention of exporting, but we must understand that prices are lower, and buyers are not taking the risk of signing contracts at a long-term, fixed price,” he said, adding that fellow producer Briquetera del Orinoco has around 100,000 mt of HBI in storage “and opted not to sell it because of the weak price environment.”
The general sentiment among producers is to hold onto material instead of selling at the bottom of the market.
Others continue to blame the poor demand for Venezuelan exports on Nucor’s direct reduced iron plant in Convent, Louisiana, which has acquired a large portion of the US market and significantly reduced demand for Venezuelan HBI exports.
The facility began DRI production in December 2013.
“The weakening prices for steel and iron ore in international markets also prevents HBI from being priced at reasonable levels,” said another trader.
The country’s export HBI spot price has been fixed by the government at $310/FOB since August 2013, and is mostly used in deals closed through Venezuela’s ministry of industries website.
The ministry has not commented the outcome of these tenders.