Ex-CIS steel slab prices have improved over the past couple of weeks in the Black Sea region specifically with the higher levels fixed in deals to Turkey. Moreover, the suppliers are rather confident they will be able to achieve a significant price rise in the coming transactions, mainly owing to limited allocation and the uptrend in hot-rolled coils (HRC) prices seen in some consuming export destinations.
According to sources, the latest deals for slabs in Turkey were closed from Russia at $630/mt CFR for March production. The estimated volume for each is around 20,000-30,000 mt. In the mentioned transactions, the suppliers managed to increase deal prices by around $20/mt as compared to the sales in late December and early January.
The new offers, according to the Turkish buyers, are heard at $660-670/mt CFR and even at $680/mt CFR. As a result, the earlier achieved levels in deals are estimated at around $600-615/mt FOB, while the new targets are coming closer to $630/mt FOB. In addition, the workable level in the south European market is estimated at $670-680/mt CFR which is also in line with the FOB levels targeted by CIS-based mills.
The key reasons for the bullish sentiment in the slab market are said to be the increased costs of production due to higher raw materials and energy prices, coupled with some output reductions to be seen at certain mills. In addition, HRC pricing has picked up in some markets like the EU and Turkey, providing some room for higher slab prices as well.