Lower demand for imported slabs in China due to the seasonal demand slowdown and falling futures prices has impacted sentiment in the Asian market. At the same time, the offered volumes have remained limited as the major Russian and Brazilian exporters have been inactive. Southeast Asian suppliers have been trying to sell to China, but customers have been resisting a further price increase.
Offers from Indonesia and Vietnam for slabs have been heard at $415/mt CFR China, almost in line with those heard last week. Though there have been rumors that some tonnages have been booked, most Chinese traders have said that this level is not workable at the moment. Taking into account that Southeast Asian suppliers are not paying two percent import duty, this price is equivalent to $407/mt CFR China for non-Southeast Asian origin slabs. As SteelOrbis reported earlier, the previous transactions for Russian and Brazilian slabs were concluded at $405/mt CFR China.
The majority of bids have been at slightly below $405/mt CFR, local sources have said. “These days it is difficult to buy as China’s futures prices are going down,” a Chinese trader said.
There has been no information about new slab sales in Southeast Asia or in Taiwan. HRC prices in Taiwan have increased by about $10/mt over the past two weeks to $460/mt ex-works and $450/mt FOB, but there has been no increase in production volumes and mills had already covered their slabs needs for the near future earlier, sources said.