Raw Material Prices
Pig iron markets seek clarity after tariff confusion
Written by Stephen Miller
April 22, 2025
The pig iron markets have been quiet for the last several weeks as tariff implementation on imports into the US became a reality. There has been debate on which party will have to pay the tariff. A recent transaction could provide the answer to that question.
SMU has verified a cargo of 55,000 metric tons (mt) of pig iron sold to a US buyer last week at a price of $485/mt CFR US Port. The freight is estimated at $25/mt.
We reached out to the seller. He confirmed the price and added that the US buyer will pay any tariff imposed. This is thought to be a reciprocal tariff of 10%.
Based upon these numbers, the tariff is calculated on the FOB load port value. In this case it is $460/mt. So, theoretically, this means an additional cost to the buyer of $46/mt. This makes the “delivered, tariff paid” cost $531/mt.
However, even without the tariff added in, the $485/mt price is up $10/mt from the March pig iron sales from the same origin.
Pig iron shortage?
This seems to reflect a shortage of available pig iron since scrap markets worldwide are under significant pressure. It also reflects the effects of the tariffs, as offers from India and Southeast Asia have probably become unworkable.
More traders, buyers weigh in
SMU contacted a US trader and importer of pig iron to understand his views on where pig iron prices are trending.
He said Brazilian sources are saying supplies are short there. He continued to say “even though scrap is down for April, I think pig iron will hold out of scarcity and tariff.”
The source thought pig iron will remain firm as mills will eventually have to replenish their supplies.
SMU also reached out to several US steel mill buyers about the tariffs. We only heard back from one who said that it appears the buyers will have to pay the tariffs.
Upcoming Brazilian quota?
Another source in Brazil told SMU that Brazil is trying to negotiate a quota for pig iron to the US instead of tariffs.
Stephen Miller
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