Despite a recent uptrend in US domestic flats prices, US re-rollers have pushed for lower slab prices in the last month. Slab asking prices from offshore sources have not changed, but actual sales prices have veered lower in light of the fluctuating iron ore price trend. For instance, CIS slab suppliers are still asking for $590/mt CFR--unchanged since last month--but recent transactions settled at $560/mt CFR. Likewise, Brazilian slab mills are still trying to push for last month's price of $585/mt FOB mill, but at least one producer finally accepted an offer of $575/mt CFR. However, sources tell SteelOrbis that there is no way slab prices can decrease any further, as they are already perilously close to production costs.
Whether this means there is a chance for slab suppliers to firm up prices in the next month (especially if the US flat product trend maintains its upward momentum) remains to be seen. But even if the slab price trend looks to be on an incline, it still might not spur US re-rollers to stock up on slab inventory. Currently, US mills are keeping inventories for 1.3 to 1.8 months of slab consumption, even while US service center coil inventory is around 2.3 months.