Global steel slab prices are currently rather strong and may firm up further, given sufficient demand in the certain markets, including Turkey and the EU, where flats prices have been rising. Moreover, supply and demand of slabs in the market are considered to be relatively balanced at the moment. In fact, while some Russian mills are not offering due to maintenance works and are focused on their domestic HRC market, slab suppliers from Asia have been quite active and the number of offers overall is sufficient.
The considerable uptrend in prices currently seen in the Turkish flats market and fueled by the rise in import scrap prices this week, is expected to also support higher slab prices. Currently, hot rolled coil (HRC) prices in Turkey are at $660-690/mt ex-works and up to $700/mt ex-works in some offers, which is a minimum $20/mt higher than two weeks ago. Moreover, taking into account higher scrap prices, some HRC buyers have already accepted mills’ increased offers. In this situation, workable import slab prices in Turkey, which are already quite strong, are expected to increase further.
According to sources, the latest deals for ex-Malaysia slab were closed for regular lots at $560/mt CFR Turkey last week, while others report offers were already $10/mt higher by the end of last week. The latest indications from Malaysia are estimated to be not lower than $580/mt CFR, while Indonesia is now at $575-580/mt CFR. Notably there have been offers from India in the market at $530/mt FOB with freight estimated at $35-40/mt for 30,000-40,000 lots. This level may be workable but actually some sources assume it should be even higher. “Scrap is higher than $400/mt and so local slab production costs are above $580/mt, so they can offer at a minimum of $650/mt ex-works [for HR] at this cost,” a market player told SteelOrbis. Higher offer levels are expected also from Saudi Arabia. The mill there is expected to increase its price by at least $10-15/mt from the earlier indicated $515/mt FOB (freight estimation at $35-40/mt if shipped from Jubail).
In addition, there have been reports of active negotiations by ASEAN mills in Europe. At least one deal for ex-Vietnam slabs has been rumored at $550/mt FOB, which is in line with the price initially targeted by the seller, but it has remained unconfirmed by the time of publication.
There has been talk about an ex-Indonesia slab sale at $540/mt FOB as well, though the sales destination has remained unclear. Market sources believe that it could be for Latin America and that the price may be slightly lower.
Asian slab importers have been not active in past weeks, with no new deals reported to China.