Prices for slabs in the global market softened in February, following the bearish sentiments which prevailed in the flat steel segment. Nevertheless, trading has been limited as buyers have mainly been waiting for a further drop of at least $20/mt before signing deals.
The main Indonesian and Malaysian mills have announced slab offers (for HRC production) at $590/mt FOB, which is down from the official offers at $600-605/mt FOB in early February. But for markets such as Turkey and Latin America, prices up to $25-35/mt lower than these levels are available.
The official offers are mainly for the European market, where prices have been holding on to higher levels over past months due to limited supply and stable demand. But there have been no fresh sales to this destination as ex-ASEAN slab prices (for HRC production) are equivalent to $635-645/mt CFR, while ex-China offers for plate grade slabs have been at $640-645/mt CFR to Europe. Vietnamese slabs (for HRC) have been available at $640-645/mt CFR to Europe, which is $20/mt below the level before the Lunar New Year holiday, translating to around $595/mt FOB. At the same time, buyers’ price ideas in the Italian market are hardly above $620-625/mt CFR for plate grade slabs, while even lower levels are awaited for HRC grade material. “Everyone was waiting for a rebound after the [Lunar] New Year holiday, but it didn’t happen. And now all are expecting a decline. Now mills are delaying purchases, HRC prices in Europe are going down, plate is stable,” a market source said. As for Russian slabs in Europe, some offers have been reported at $620/mt CFR and a deal from a sanctioned mill has been rumored at $615/mt CFR, but this has been denied widely by market sources as “this level is too high as for [sanctioned] Russia,” one trader said.
In Turkey, market activity, especially for non-sanctioned material, has been weak as bids have been dropping much faster than offers. The previous deals for two lots of ex-Malaysia slabs have been done at $620-625/mt CFR. But at the moment, the indicative offers from Malaysia are assessed at $600-605/mt CFR, which is still not workable, taking into account falling HRC prices in the country. Market sources believe that the highest possible for buyers for duty-free Malaysian slabs would be $555-560/mt CFR. Offers from Indonesia are at $590-595/mt CFR Turkey, while bids are $40-45/mt lower.
A deal for 20,000 mt of ex-Russia slabs has been rumoured at $550-555/mt CFR, but it has remained unconfirmed by the time of publication, and a number market sources believe that, if true, this is an old transaction as today’s workable level for slabs from the non-sanctioned Russian mill is at $540/mt CFR, while the sanctioned mill’s material should be priced at $510/mt CFR. According to market sources.
In Latin America, where the last sales of ex-ASEAN slabs were at $630/mt CFR before the Chinese New Year, the tradable level is at $600/mt CFR at the highest for now.