Export prices for steel slabs from the CIS are expected to be supported by higher workable levels in Asia, while the bids in the Mediterranean region are on the lower side. As a result, the sellers are expected to shift their focus in sales in order to keep the margins.
Black Sea region-based CIS steel slab prices have decreased by $5/mt over the two weeks to $365-370/mt FOB. In particular, a 90,000 mt of cargo has been earlier traded to Thailand from Russia within the mentioned FOB range or at $405-410/mt CFR, as SteelOrbis reported. Moreover, the suppliers are expected to focus on sales to Asia as the offer levels, as well as the expected deal prices to the region, are foreseen to increase.
China has been more active in the import market of semis and HRC this week. A deal for a large cargo of slabs from Brazil has been signed at $408/mt CFR, a number of sources confirmed. This price level is $3/mt above the previous transaction to China. But late this week there have been reports in the market about a sale at $415/mt CFR China. This has not been confirmed so far, but insiders agree that the workable price level has already exceeded $410/mt CFR in China this week amid higher flat steel prices in the local market. The level of $410-415/mt CFR China translates to $370-375/mt FOB Black Sea.
As a result, even with the increased freights, which are estimated at up to $39-40/mt to China from the Black Sea area, the sales to Asia are estimated as still more marginal for the CIS-based mills. This means that Turkey, and maybe Italy, might not get the slab offers, acceptable for them in terms of costs and their finished steel prices. Earlier this week Turkey was receiving offers at $380-385/mt CFR from the CIS and at $390/mt CFR from the UK. Later on ex-CIS offers have increased up to $385-390/mt CFR, corresponding to $370-375/mt FOB and above. However, no deals have been confirmed by the time of publication. Mills’ bids were reported at $373-375/mt CFR, but the trade levels will largely depend on the hot rolled coil market situation, SteelOrbis understands.
