Worsening sentiments in the hot rolled coil (HRC) market in Asia, uncertainty regarding steel demand in the first half of this year due to the spread of the coronavirus in Southeast Asia have put pressure on slab prices. While demand from Taiwan, Indonesia and Thailand has been subdued, China has resumed imports amid improvement in its local market.
The price for slabs has come to $405-410/mt CFR in recent bookings to China last week, while the previous transactions to Indonesia were reported at $415-420/mt CFR, as SteelOrbis reported earlier. In total, there have been enquiries from China for up to 100,000 mt of slabs. According to market sources, apart from Russia, traditional suppliers of slabs to Asia, Japanese producers have also remained active with offers at $410/mt CFR to China and $415/mt CFR to Southeast Asia. Indonesian supplier Dexin Steel has also started to sell slabs in the export market with a deal to China at $405/mt CFR. Though the producer has not confirmed it by the time of publication, traders have said that this step is logical, taking into account that Dexin had already sold 20,000 mt of billet to China last week.
“China has money and the possibility to recover, but many other economies have just stopped,” a Taiwan-based source commented. “There are inquiries for billets and slabs as local demand is improving. The outlook for April is good,” a Chinese-based trader said.
At the same time, demand for HRC in the Asian market has been very weak. The workable price level for SAE1006 HRC in Vietnam has decreased to $455-460/mt CFR, versus previous deals at $465/mt CFR Vietnam.