TEX reported that transaction prices of slab supplies from without in Asia are thought to have fallen to below USD 500 per tonne FOB for shipments in the October to December 2010 quarter, prices that apply to slabs for sheet production. There is even information on a price level of USS 500 per tonne CNF for delivery in Asia in slab exports out of Russia and Ukraine. But it is uncertain whether the price level has brought firm deals.
Negotiations on slab supplies into Asia for October-December shipments started when a Brazilian steelmaker offered slab exports there at USD 600 per tonne FOB, up USD 60 to USD 80 from a quarter ago.
In September 2010, export prices of slabs from Russia and Ukraine were reported as USD 530 per tonne FOB for shipments to Asia. In October, they were reported as USD 510 per tonne FOB. At present, there are signs of a more price reduction as Russian and Ukrainian steelmakers favor realization or clearance sales of slabs before port facilities freeze in winter.
In Asia, meanwhile, South Korea's Hyundai Steel Co is said to have begun selling slabs both at home and abroad. As a result, it is understood that domestic users, who usually depend on slab imports, are shifting to purchasing locally available slabs. Also, Hyundai Steel is reported to have negotiated a slab supply contract with Taiwan's steel re roller.
It is Hyundai Steel's emergence as a new slab supplier in Asia that amounts to a factor in weakening slab prices there, market observers point out. Besides, HR coil prices in Asia have declined considerably in the October to December quarter. As a result, slab prices, too, are believed to have softened to a substantial degree.
At present, though, the world's iron ore prices are on the rise, which could help prevent a further decline in the world's slab prices. Speculation is afloat that the world's raw materials prices may go up by 10% or so in the January to March quarter of 2011 as compared with the quarter before. Accordingly, there are forecasts that global slab prices will rebound and advance by USD 30 to USD 40 per tonne in the first quarter of 2011.