Brazils spot market for steel slab exports has
been virtually stagnant for the past few months amid very low
prices in the international market and output issues.
Import prices for
commodity-quality slab in Southeast Asia, one of the few
regions in the world to remain active in the slab-buying
market, have plunged by more than $100 per tonne over the past
three months, local traders told AMM sister
publication Steel First, which assessed prices at $455
to $475 per tonne c.f.r. this week, down from $575 to $585 in
Prices in Southeast
Asia are around $460 per tonne c.f.r., one source at a major
Commonwealth of Independent States steelmaker said.
In Brazil, only
ArcelorMittal Tubarão is said to be active in the export
market, but it exports slab directly to some customers based on
previously signed contracts, sources said.
The steelmaker has
been producing slab at an annual rate of only 500,000 to
600,000 tonnes for export, and is focusing on more "special
products," chief executive officer Benjamin Baptista told
Steel First last month.
SA, whose usual customers include California Steel Industries
Inc. and AK Steel Corp. in the United States and Taiwan-based
China Steel Corp., reportedly has made a few shipments this
year but is now focused on putting its new
770,000-tonne-per-year hot strip mill on-stream, which means it
will have a lower volume of slab, billet and bloom available
Siderúrgicas de Minas Gerais SA (Usiminas), the largest
flat steel producer in Latin America, hasnt been
exporting commercial-quality slab, only out-of-specification
material, commercial vice president Sérgio Leite said
Siderúrgica Nacional SA (CSN) has not only been out of
the export market for slab, but it had to buy the semifinished
product in the first few months of 2013 because of problems
with its iron ore output after previously buying slab due to
maintenance works at its melt shop.
Output issues at both
CSN and Siderar Saic, and the commissioning of Gerdaus
hot strip mill, led to lower volumes of Brazilian slab
available for export outside South America.
Issues in 2013 aside,
Brazilian slab exports had already been falling for the past
few years on low international prices and strong demand for
rolled products in the country.
Output of slab for
sale has decreased at most local steelmakers, data from
Brazilian steel institute IABr show.
ArcelorMittal Tubarão fell to 804,000 tonnes last year
from 1.62 million tonnes in 2011 and 2.56 million tonnes in
2010; Gerdau produced 1.09 million tonnes of slab for sale in
2012, down from 1.21 million tonnes in 2011 and 1.17 million
tonnes in 2010; and CSN produced no slab last year vs. 34,000
tonnes in 2011 and 54,000 tonnes in 2010.
Usiminas was an
exception, increasing its slab output to 899,000 tonnes in 2012
from 708,000 tonnes in 2011 and 767,000 tonnes in 2010, but it
expects to sharply reduce slab sales this year as it makes more
Were it not for
ThyssenKrupp AGs 5-million-tonne-per-year Cia.
Siderúrgica do Atlântico Ltda. (CSA) mill in Rio
de Janeiro state, commissioned in mid-2010, Brazils slab
export figures would have decreased significantly over the past
three years. Output at the mill, which is destined for
ThyssenKrupps rolling facilities in the United States and
Germany, rose to 3.43 million tonnes last year from 3.16
million tonnes in 2011 and only 435,000 tonnes in 2010,
according to IABr figures.
Slab exports directly
from Brazilian steelmakers in the first five months of this
year reached 1.85 million tonnes, down nearly 30 percent from
2.61 million tonnes in the same period last year, IABr data
show. Shipments to the United States fell to 1.06 million
tonnes from 1.21 million tonnes, while South Korea took 124,951
tonnes, down from 333,178 tonnes in the same comparison.
No major change is
expected in Brazils slab exports for the rest of 2013
unless prices recover in the international market, the trading
sources told Steel First, although some support could
come from the Brazilian currency, which has been losing value
against the U.S. dollar since the middle of May.
"We still havent
heard from (Brazilian) mills about any export offers for slab,"
one trader said. "But maybe the dollar (strengthening) makes
A version of this
article was first published by AMM sister publication Steel