A source linked to a slab producer in Brazil said the company has recently reduced its exports but has closed a few export deals for shipment in September.
The source said that the reduced margins from prices in the international market did not justify maintaining the same volume of exports of the previous months, adding that the production pace had to be reduced, as the domestic market was not capable of receiving such production if maintained at full pace.
The main target for domestic slab sales is Usiminas, which has one blast furnace idled for maintenance in the Ipatinga plant and another expected to be idled for refurbishment in April 2023. The company is currently increasing stocks to maintain its rolling operations, having received in July a shipment of 44,800 mt from China at $867/mt, FOB conditions. It was the first significant volume of slab imported by Brazil in 2022.
Sources mentioned that a gap of more than $50/mt persists between price expectations by buyers and sellers in the merchant slab market.
In July, Brazil exported 533,100 mt of slab, in average at $1,026/mt, against 517,200 mt at $1,178/mt in June, both FOB conditions.