With the continued slump of flat rolled demand, US
slab demand is still low and market activity remains quiet; however, if
scrap prices continue to improve, then
slab prices may register an up-tick as well.
Import
slab prices continue to range between $300 and $310 /mt FOB loading port, and some suppliers may agree to even lower prices. And while there is a positive sentiment in the Asian markets which is resulting in some price improvement for slabs in that region, market sources mention that US re-rollers still have adequate
slab inventories and are not planning to purchase
slab in any significant amounts until demand for flat rolled products starts to improve.
Meanwhile, the recent up-tick in domestic and international
scrap prices and increases in
semis prices in some of the foreign markets have not resulted in any improvement for US hot rolled coil or
slab prices as of yet. Market insiders suspect the recent
scrap price improvement may just be the result of temporary inventory adjustments and does not indicate that the
scrap market has embarked on an extended recovery. However, if the upward
scrap pricing trend continues, prices for
slab and hot rolled coil should follow the upward trend. But given the current lackluster steel demand situation, an extended rebound in raw material prices seems unlikely.
Although the US
slab market continues to be soft, the latest data from the US Department of Commerce's Steel Import Monitoring and Analysis (SIMA) system shows that the total amount of
slab imports in April (as of April 21, 2009) was 76,229 mt, which reflects an increase of 38,536 mt when compared to the figure of 37,693 mt in March. Nevertheless, this figure is 484,832 mt less than the 561,061 mt imported in April 2008. In April, the US imported
slab tonnages mostly from
Japan, at 34,767 mt;
Mexico; at 26,932 mt; and
Canada, at 14,530 mt.