Ex-Asia slab prices have been falling rapidly over the past two weeks due to the continuing decline seen in the flat steel segment in the region and very poor sales slab sales seen over the past month. The situation of slab shortages globally and strong prices seen in the second quarter has disappeared now.
Indonesian slab (for HRC production) has been offered at $475/mt FOB for August shipment, down by $15/mt from last week and by $20/mt compared to what was seen two weeks back.
Offers for Vietnamese HRC slabs have been at $490/mt FOB, down by $20/mt from a deal heard in the US in late June. Since the seller has managed to push sizable volumes of HRC locally and in the export market, its slab offer is not as low as that from Indonesia. Another Vietnamese mill has been offering slabs (for plate production as well) at $505/mt FOB, but this price is assessed as being too high and to sign contracts additional discounts will be needed. “They are not really selling right now. They are very restricted in quality [only for narrow plate production]. So, I think if they sell it will be at a lower level,” a trading source said.
Chinese suppliers have also cut slab offers, but the lowest level is still in the regional Southeast Asian market. For instance, firm offers for HRC grade slabs have been reported at $490/mt CFR, translating to $470/mt FOB maximum, declining $10-20/mt over the past fortnight. The prices have been impacted by the significant drop in HRC prices (import Vietnamese HRC is at $520-530/mt CFR in Vietnam now), as well as the emergence of Iranian slabs, available at $475-480/mt CFR Southeast Asia.
In Europe, most offers for plate grade slabs, including those from top-tier mills from China, have been heard at $570-580/mt CFR, but the tradable level for plate grade slabs is still at $560-570/mt CFR. Market sources said that, even though there have been no active bookings yet, the prices for slabs in this round will be near the $560/mt CFR mark, while in the previous round of purchases it was at $590-600/mt CFR over a month ago.
In Turkey, activity in the import slab segment has been close to zero and, after the reduction of domestic production costs, the highest tradable level for import slabs of “clean” origins has been assessed at $520-530/mt CFR or below.
