Asia’s export slab market has been at a standstill during the third week of December, following sales with some discounts done to Europe earlier in the month and great uncertainty regarding CBAM and other regulations in Europe. Moreover, sales to other alternative destinations, like Turkey, have been limited.
Deals for Asian origin slabs - Chinese and Vietnamese - have been done at $500-515/mt CFR, according to market sources, which is slightly down from the initial offers of most Asian sellers for plate grade at $520/mt CFR in late November. “$500/mt CFR is a very good price for plate grade slabs in Italy,” a trader said. Some negotiations for Brazilian slabs have also been heard, but the price is unknown. “The CBAM situation has everyone twisted and they don’t know what to do. Europeans have booked from China, other Asian countries and Brazil for early first quarter arrival, but no one knows actually what is going to happen… The fact is no one knows how to calculate,” a European source said.
One of the reasons why buying import slabs with arrival after January 1 increased in early December has been some improvement seen in the outlook for flat steel products. In particular, deals for plate have already reached €670/mt ex-works and mills are going to target up to €700/mt ex-works in the second quarter. In the HRC segment, deals at higher levels are harder but the intention to increase prices is also there.
The tradable level and offers for HRC grade slabs of Asian origin to Europe are at $485-490/mt CFR. "Because of low HRC prices and limited volumes [sold in the export market], Taiwan is becoming regular in slabs sales," a Europe-base source said.
In other sales destinations, demand has been extremely weak. Turkish buyers have received offers for Indonesian slabs at $480/mt CFR, while other Asian materials are quoted at around $5/mt higher than this. This price is too high for the majority of buyers, while there have been almost no fresh offers from Malaysia, which is duty-free in Turkey. At the same time, Russian mills have offered the lowest prices to Turkey. The non-sanctioned Russian mill has been ready to negotiate at $440-450/mt CFR Turkey, while the price for sanctioned Russian slabs has been as low as $430/mt CFR. But there have been no reported deals even at such low levels, as Turkish customers are afraid to book Russian feedstock as this can cause problems when they will target flat steel exports to Europe.
The majority of Asian sellers are quoting slabs at $445-465/mt on FOB basis.