Although international slab prices have increased slightly along with the US flat rolled prices, slab demand remains slow and supply is sufficient.
After US mills announced a flat rolled price increase of $40/mt for September, slab prices followed the upward trend and went up slightly as well. However, within a week of the flat rolled announcement it became apparent that the full $40/mt increase would not come to fruition, as US flat rolled purchase prices only increased approximately $10 to 20/mt, with that uptick now experiencing some softening. Nevertheless, it is heard that US mills will try to increase the flat rolled offer prices again for October shipments, but such an increase is expected to merely stop any softening and maintain current transaction prices. Slab prices will continue to follow the flat rolled products' pricing trend and re-rollers anticipate the slab prices are likely to decline in late October or early November. For now, it is expected that international slab suppliers will ask for an average of approximately $560/mt CNF unloading port for October shipments. Due to slow slab demand, a lower price level may be concluded through negotiation.
There are a few slab purchasing activities to be seen in the market, but transactions are projected to become harder to see toward the fourth quarter. As demand is usually low in the fourth quarter due to holidays and most companies closing their fiscal year, companies will try to maintain inventories at low levels. Also, with the uncertain market situation, re-rollers might hesitate to replenish the inventory in large amounts. Therefore, slab prices are trending downward.
The latest data from the US Department of Commerce's Steel Import Monitoring and Analysis (SIMA) system shows that the total amount of slab imports into the US in the month of July was 471,109 mt, representing an increase of 112,645 mt when compared to the figure in June 2010. The main countries that exported slab to the US in July include: Russia, at 199,316 mt; Canada, at 164,917 mt; Mexico, at 41,924 mt; Japan, at 36,488 mt; and Germany, at 27,997 mt. Italy also imported a smaller amount of slab from the US during the period.