In 2020, the global pig iron market faced the threat of a demand slump due to the reduction in steel production from all major outlets under the pressure of the Covid-19 pandemic.
In March, however, when the steel industries of Europe and the United States began to feel the effects of various national lockdowns, the Chinese market began to recover and soon resumed normal operating rates. Thus, China started to absorb almost all merchant pig iron supplies, leaving almost no availability to other buyers and pulling pig iron prices up. Pig iron availability is limited. The Commonwealth of Independent States prefer to use as much as possible for their own steel melting, while Brazil can’t increase merchant pig iron output immediately because they’re limited in charcoal, one trader said. When supply is limited but demand exists, buyers need to compete.