The prices and sentiments in the HRC segment globally have increased over the past two weeks, also pushing targeted prices for slabs up in the global market. But the most promising destinations, especially for Asian slabs suppliers, have been Latin America and Europe, while demand in Asia and Turkey is likely to remain slow in the near future.
The latest bids for ex-Vietnam slabs from Latin America have been reported at $555-560/mt FOB and, though no deal has been done so far, negotiations are active. Asian suppliers are not in a great hurry to sell as they expect prices to increase a bit more. “FHS’ [Formosa Ha Tinh] date for readiness of cargoes is now March 20, with shipment in March/early April. The price is estimated to be above $560/mt FOB as there are already bids at this level on the table,” a trader said.
Also, market sources said that last week the highest bids from the EU were heard at $600-620/mt CFR, which translates to $550-560/mt FOB from Southeast Asia. But taking into account recent talks about the local HRC price increases in Europe, market sources are expecting bids for slabs to improve too. “First, we need to see what HRC prices would be accepted in Europe,” a market source said. Some trading sources believe there are chances that slab prices in Europe will reach $650-680/mt CFR.
Turkey’s import slab market has been very slow recently with a very limited number of offers, taking into account the current low demand. “No one is willing to import semis, but rather scrap, due to the license issue. Turkish exports are really very bad,” a local source confirmed. Previously, the licenses for importing semis for finished steel exports were on annual basis, but now they have been changed to four months only. And with the significant decline in overall finished steel exports from Turkey due to lower prices and higher competition globally, Turkish mills have been less interested in semis imports, and this situation is unlikely to change in the short term.
In the previous round of sales, an Indonesian mill sold slabs at $540-545/mt FOB or so, according to sources. Though one deal was rumored at $595/mt CFR in the local Indonesian market a week ago, market sources said that in general this level has not been acceptable in Asia and “if true, could be an exception,” a source said, adding that only for plate production is this price possible. At the same time, most Asian customers are assessing the slab price level at not above $570-575/mt CFR. Though the Asian market has been slow, at least one integrated mill from Indonesia has hiked offers to above $600/mt CFR, which is totally out of the range of interest of buyers.
Some rare offers from Iran have been reported to Southeast Asia at $570-580/mt CFR. The SteelOrbis' reference price for imported slabs in Asia has settled at $550-590/mt CFR with the midpoint at $570/mt CFR, which is up by $7.5/mt over the past week.