Asian slab prices have dropped in the middle of August as flat steel prices in the region plunged this month. The slab prices from traditional suppliers moved to $425-430/mt CFR, which is $20-30/mt below the offer prices in early August. Iranian slabs were not in demand due to sanctions and comparatively high prices. Asian buyers have preferred to book Russian and Indian slabs.
A deal for 40,000 mt of Russian slabs was concluded at $430/mt CFR Taiwan for October shipment last week, SteelOrbis was informed. Moreover, another 40,000 mt of Indian semis changed hands at $425-430/mt CFR Indonesia. In first half of the month, suppliers and customers have seen the workable price level at $440-445/mt CFR, but a sharp drop of HRC prices has put pressure on customers’ bids.
Taiwanese flat steel producers faced reduced local demand due to the rainy season and the export market was almost fully closed for them due to aggressive offers from India and China. “Indian HRC producers sell at $470-480/mt CFR Vietnam, the Chinese at $490/mt CFR. We cannot compete,” a Taiwanese flat steel producer said. Though the local prices were still more attractive and stayed above $510/mt ex-works, the overall trading volume went down, pushing re-rollers to cut capacity utilization rates. In some cases, it came to 50 percent, SteelOrbis understands.
The latest offers for Iranian slab have been heard at $420/mt CFR, which is in line with the previous deals or even slightly higher compared to the beginning of this month. “But considering that Russia sold at $430/mt CFR to Taiwan, this price is out of interest,” a trader commented.
It is expected that the slabs prices will stay under pressure and will depend on further development in the HRC segment in the near future. Bids were coming at $420-425/mt CFR this week.