Demand in the global slab market has remained subdued over the past weeks, with buyers not being confident that the flat steel market has the potential to show sustainable improvement. As a result, the latest deals signed mainly by ex-ASEAN and ex-Russia slab exporters have been at relatively stable levels compared to the previous contracts.
Ex-Indonesia mill has managed to sell a few lots of slabs at around $515/mt FOB last week and early this week. The last deal was for 50,000 mt. The material is destined for Turkey, while the previous ex-Indonesia booking was to Latin America for 40,000 mt at the same FOB level in late July.
In Turkey, the availability of import slabs is not plentiful and the difference in the prices for various origins is quite large. Ex-Malaysia offer prices have been indicative at $570-575/mt CFR and are not workable. So, according to sources, sizeable ex-Indonesia slab sales, which have been reported at $540-545/mt CFR Turkey, are reasonable, though they are also considered quite high. “It is a quite high price but they [the buyers] have no choice but, also, they will earn something still. The rolling cost is claimed to be $70/mt from slab to HRC, but I honestly think it is no higher than $50-55/mt for the base HRC sizes,” a trader told SteelOrbis.
Turkey’s interest in ex-Russia slab has been lower recently due to the risk of sanctions. No new sales have been reported, though one of the suppliers has increased its offers to $510-520/mt CFR, from $480-500/mt CFR seen two weeks ago. Another seller from Russia is currently out of the market due to scheduled maintenance works.
Nevertheless, some sales of ex-Russia slabs have been reported in Asia. In particular, one or two deals have been reported to Southeast Asia at $480/mt CFR, which is in line with the previous sales from Russia to China, though below suppliers’ targets of $500/mt CFR seen early this week. “Demand is bad, and ASEAN mills, which are not under sanctions, are asking $550/mt CFR, which is impossible,” an Asian source said. Some ex-ASEAN offers are at $535/mt CFR to other Asian buyers.
No new deals have been reported to Taiwan. “As our utilization rates will fall again in September due to slow buying for finished steel, there is not much demand for slabs,” a source said.