According to a market source in Brazil, exports of slab to the US remain closed at in a range of $540/mt to $550/mt, FOB conditions for the basic commercial grades, the same range as last week.
The source mentioned exports to other destinations are being closed in a range $500/mt to $510/mt, under the same conditions, the same range over the last two weeks.
The source added that there are expectations for higher prices of steel products, as there is a shortage of supply of iron ore pellets due to the stoppage of production at the Fabrica and Vargem Grande pellet plants, located near Vale’s Brumadinho waste dam that collapsed in January.
Although blast furnaces can operate without pellets, the volume of pig iron will be reduced when the operation is based only on sinter and lumps, a situation currently affecting steel plants located in the Brazilian southeast region, such as Usiminas, CSN, Tubarao, Ouro Branco and Ternium.
Without pellets, productivity is also affected, as the consumption of coke increases, leading to higher production costs and putting additional pressure on steel prices.
In March, Companhia Siderurgica do Pecem exported 157,500 mt of slab at $471/mt, ArcelorMittal Tubarão exported 152,000 mt at $507/mt, and Ternium exported 111,200 mt at $487/mt, all FOB conditions, different quality grades and price deals probably closed in January.
The US was the main destination, 314,400 mt at $503/mt, followed by Italy (55,400 mt at $464/mt) and Mexico (46,500 mt at $430/mt), both FOB conditions.