The situation in the Southeast Asian slab market has worsened over the first week of October as demand has dropped further. Offer prices for ex-CIS slabs are still at $390-395/mt CFR, which corresponds to the deal signed in late September, but no new contracts have been reported over the past week.
Though slab prices have remained mostly stable, ample offers of import HRC have put pressure on the market outlook. Slab consumption might be reduced up to the end of the year, SteelOrbis has learned. “This is the market price, but what we will do with HRC demand, if no one wants to buy?” a Taiwan-based source said. There have been a lot of offers for HRC from traditional sources like South Korea and India and non-traditional suppliers like Brazil, Turkey and Egypt, and prices have been at $440-450/mt CFR Taiwan. Some re-rollers in Taiwan have even decided to stop production in October due to extremely weak demand.
While demand for slabs in Southeast Asia has been subdued, Chinese traders have been looking for imported slabs as “local prices in China are higher, so some mills may consider using import semis rather than keep high production during the heating season,” a source said. Slabs ex-Iran have changed hands at $380/mt CFR China, according to traders.