According to sources, with the return to operation of blast furnaces and slab production at the Posco plant in Pohang, after the typhoon and subsequent fires that recently hit the plant, there are expectations of declining prices in the global merchant slab market.
As hot rolling activities are taking longer to restart at Pohang, slab production that would be earmarked for HRC production in the plant is expected to be diverted to exports, with negative impact on prices.
This scenario is the opposite of expectations by Brazilian slab exporters last week, who were forecasting increased slab prices due to the reduced slab production at Pohang.
Meanwhile, Brazilian producers maintain $650/mt, FOB conditions, as their base price for shipments in November, with few significant deals closed so far, as the gap between offers and acceptable prices remains in the $40-50/mt range.
However, this is reportedly not a major concern for the Brazilian slab producers, as local steel producer Usiminas is increasing its slab inventories to use during the stoppage to revamp one of its blast furnaces next year, while CSN is also buying slab to increase its rolling operations.