Lukewarm demand and softening flat rolled prices is contributing to a slow US slab market.
Although SteelOrbis has heard of numerous slab offers in the US market, there are not many slab bookings to be seen for the time being, as most re-rollers have already bought adequate slab tonnage. Nevertheless, it is expected that slab purchasing activity will increase by late June or early July when re-rollers start securing slab tonnage for the third quarter.
As for import offers, some CIS suppliers are presently trying to maintain high price levels at over $700/mt CFR; however, re-rollers are not in a hurry to buy and are attempting to negotiate down to the approximate level of $670 to $680/mt CFR. With US flat rolled prices down from prices reported a month ago, and speculation pointing to the possibility of further softening, US slab buyers are hoping to see more comfortable slab price levels in July.
There are plentiful slab supplies in the market while US slab demand is softening. Additionally, Brazil-the main slab exporter to the US-is currently experiencing a sluggish domestic steel market, leading to lower slab demand and allowing more slab tonnage for the export market.
The latest data from the US Department of Commerce's Steel Import Monitoring and Analysis (SIMA) system show that the total amount of slab imports into the US in the month of May was 697,093 mt, reflecting an increase of 136,110 mt when compared to the figure in April. The primary countries that exported slab to the US in May were: Brazil, at 276,940; Russia, at 181,314 mt; Canada, at 74,676 mt; Mexico, at 53,834 mt; Japan, at 36,393 mt; Slovenia, at 35,860 mt; and Australia, at 35,530 mt.