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Southeast Asian slab market slows

Posted on 10 February 2021

The East Asian slab import market has weakened in tandem with the fall in Chinese hot rolled coil prices in the second half of January, Kallanish notes.

Traders blame sluggish market sentiment on the approaching Lunar New Year holiday. Rumours that Chinese authorities will be cutting export rebates on Chinese HRC and other steel products effective April could indirectly be providing support for slab import prices.

Russian coil-making slab offers are most likely prevailing at $650-660/tonne cfr Southeast Asia, regional trading sources close to exporters say. They say a rumoured offer for Russian slab at $630/t cfr Taiwan is too low. "But most buyers are off for the Lunar New Year holidays, so, practically, it will not make a difference," a trader says.

A Taiwanese trader agrees that Taiwanese re-rollers have little interest in booking anything at this time. But he feels re-rollers would also not react to $630/t cfr because it is too high, considering Chinese HRC prices recently fell to $660/t cfr Vietnam levels. While the prime Asian mills are offering HRC at above $750/t cfr East Asia, he believes that not many overseas buyers are accepting this price level.

The rebate rumours are holding up HRC prices for now, but the HRC market had been trending downwards, he adds. Russian slab was offered at $685/t cfr Taiwan in mid-January.

Russian coil-making slab for May shipment was recently offered at $660/t cfr Indonesia, a Southeast Asian trader reports. A Thai source says Russian coil-making slab for April shipment sold last week at $645/t cfr Thailand, but others did not hear this. In early January, deals for slab took place in Indonesia at $670-680/t cfr.

Source : Kallanish