Venezuela's hot-briquetted iron prices have increased about 10% following recent global macroeconomic trends and higher raw materials prices worldwide, trading sources said this week.
S&P Global Platts' monthly Venezuelan HBI export price assessment increased to $207.50/mt FOB for December bookings, based on a range of $195-$220/mt for bids, offers and deals. Previous prices were based on a range of $180-$200/mt FOB.
"Demand for the product has grown since global coal prices have increased. Since HBI has a high concentration of Fe, it requires less use of coal," said one Brazilian steel industry executive.
One local trader said early November HBI deals were closed at lower marks. "We closed a deal in the beginning of the month with 30,000 mt from the Puerto Ordaz region to Panama, priced at $185/mt FOB at the time, but now prices are at least around $195/mt FOB minimum," he said.
According to the source, Venezuela has material available for negotiation.
A UK trader said that in previous months lower values for "low quality" material were seen, but the cheapest price during November was more than $190/mt FOB. He added that all Venezuelan HBI and DRI is sold on the spot market.
A second British source said current prices were around $215-$220/mt FOB.
Some producers have recently managed to resume operations, because the higher coking coal prices are sparking greater demand for HBI.
An Austrian trader said in the beginning of November he expected to export between five to six cargoes from Venezuela during November and December, of which two were already confirmed carrying 33,000 mt each and destined for Europe. At mid-month, the source said his trading company bought one cargo out of a tender. "Our bid price was $196/mt FOB," he said, adding three other companies offered $190/mt FOB for the cargo.
One cargo with briquette chips is expected to leave Venezuela in December, but prices were not confirmed.
A US trader was reported to have won a tender from Comsigua with a final value of $219/mt FOB, but did not close the deal.
According to a source at a big trading company, other bidders have been domestic companies with a lack of money to make full prepayment and so producers are giving preference to large well-known companies.
Offers for December varied from $180/mt to $220/mt FOB. Most of the offers are for 30,000 mt.
Only one trader was seen offering material at $180/mt FOB, but that could rise to $190/mt FOB. The Latin American trader said he is looking for a regular buyer of 30,000 mt/month, for a year, with deliveries 30-45 days after purchase.
"The last confirmed prices seen were $180-$200/mt FOB, but it seems some deals are at $200-$220/mt FOB now," one US trader said.
Another US trader offered 30,000 mt for around $200/mt FOB of Ferrominera Orinoco HBI.
A Spanish trader said he has a good relationship with Venezuelan producers and offered around $200/mt FOB for 30,000 mt of HBI.
One local trader is maintaining HBI offers with conditional pricing, saying that if a buyer wants the material now, with urgency, it is $250/mt FOB, while if the loading is expected within an undisclosed period of time, it closes lower at $220/mt FOB.
By comparison, Libya FOB prices are around $20/mt higher than Venezuela's.
Export prices on a CRF basis were also seen as higher to Europe and Asia, at $270-$300/mt, while CIF Europe prices for Venezuelan HBI were seen at $280/mt, following rising coking coal and iron ore prices.
"One vessel with 30,000 mt arrived at an Italian steelmaker -- not disclosed -- with a value of around $300/mt CIF basis," the local trader said, adding the material came from Venezuela.
