Prices in the import slab market in Asia have already hit the bottom and have started to show some slight rebound. This has happened mainly amid some restocking seen in Southeast Asia, though without any sustainable positive changes in the flat steel product segment it will be hard to push slab prices up much further.
According to sources, deals for ex-Russia slabs have been reported at $625-645/mt CFR to Southeast Asia with the lower end of the range corresponding to last week’s contract price, while this week prices have increased closer to the higher end.
As a result, the SteelOrbis reference price has increased from $620-625/mt CFR last week to $625-645/mt CFR.
“This was the bottom, so buyers started to purchase. Production costs are high. Slab prices do not have any room to go down, while the spread with HRC prices is still high,” a seller commented.
But some sources said that, if the sentiment in the HRC market in the region remains bearish, there will be problems in pushing slab prices up. “We still see the market as weak, as HRC buying is bad,” a Southeast Asian source said. Just today, January 12, Formosa Ha Tinh dropped its HRC prices by $70/mt from last month, seeing low demand and an unpromising outlook. The latest tradable level for imported HRC in Vietnam is staying at $745-755/mt CFR at the moment.
One of the major Chinese mills has purchased slabs at $638/mt CFR recently, though reportedly for ultra-low-carbon grade. The last deals to China were done in early January at $620-625/mt CFR, but slabs of other origins.