With the skyrocketing US flat rolled prices, slab prices are escalating as well.
There is no significant improvement on domestic slab demand yet, and there are not a lot of slab transactions to be seen in the market. With adequate slab inventory, re-rollers are not in a hurry to make purchases. On the supply side, mills are experiencing a temporary shortage. International slab suppliers are controlling slab availability and prices, and Brazil, which is usually a major slab exporter to the US, is not offering much slab right now due to bad weather and the emerging coal situation in Australia.
On the other hand, US flat rolled prices have sharply increased by approximately $12.00 cwt. ($265/mt) since mid-November 2010, and the domestic flats prices will likely continue to go up next month, though at a slower pace. Therefore, with the limited slab availability and soaring US flat rolled prices, slab prices have gone up significantly as well. Current slab offers are at $645 to $655/mt FOB loading ports, representing an increase of approximately $80/mt when compared to a month ago, and it is expected that slab prices will get higher along with the increasing US flat prices.
The latest data from the US Department of Commerce's Steel Import Monitoring and Analysis (SIMA) system show that the total amount of slab imports into the US in the month of December 2010 was 297,591 mt, reflecting an increase of 119,043 mt when compared to the figure in November 2010. The countries that exported slab to the US in last month were: Brazil, at 131,737 mt; Russia, at 39,839 mt; Japan, at 37,656 mt; Netherlands, at 35,161 mt; Canada, at 26,733 mt; and Mexico, at 26,466 mt.