Despite a recent uptick in spot prices for slab imports to the US, the overall price trend remains down, due to limited demand and more than sufficient availability in the market. The price uptick, caused by a small spike in international iron ore prices, lifted slab prices in the last couple weeks after dropping in mid- to late-October, but sources are not sure the trend will last long. Current offer prices from the CIS region now stand at $590/mt CFR to US ports, while offers from Brazil are at $585/mt FOB Brazilian mill. However, sources tell SteelOrbis that there are hardly any transactions at those levels, due to a weak demand environment in the US.
Partly to blame for the downtrend in US slab demand is the weak domestic flats market. Although US flats mills have tried to reverse the trend in the last week by announcing price increases, it is still uncertain how successful the mills will be. As such, overseas slab producers are hesitant to react to the US flats trend, especially considering how tepid purchasing volume has been in the last month. US re-rollers have plenty of inventory to meet their needs, and might not look seriously into major slab purchases until Q1 2012.