Merchant slab prices are following a downward dynamic in the majority of importing regions. This includes the US, despite prices of flat products there remaining the highest globally.

After a long spell of resistance to lower bids, suppliers appear to be willing to revise offers down, with sentiment in some importing regions worsening beyond sellers' expectations. "Slab is well below $700/tonne fob Black Sea now, even though no sales have been made at this level thus far," one market source confirms.

Offers of CIS slab were indicated at around $700/t fob last week, and a Ukrainian producer sold around 65,000 tonnes of slab to Europe, including Italy, Kallanish understands, at an average of $750/t cfr. But this price level is not achievable today, sources say, as the Turkish lira's collapse and expectations of further weakening have displaced the country's buyers from the market at this level. The highest price payable today is estimated by several market sources at $650/t cfr Turkey, based on the exchange rate.

"Indeed, the weakening of the lira against the US dollar is beneficial in the export market, but the latter is very limited, while the domestic market's deterioration potential is much greater, as it affects consumption on all levels," a market observer explains.

Demand in Asia remains weak, with bids very low, and no offers were heard to the region from Russia or Ukraine. Regional prices are all below $700/t cfr this week, on China's ongoing slacking. This week's futures' rebound, however, is a positive first sign of the possible wider market recovery, albeit indications are still too weak to indicate a rebound, sources muse.

The Latin American market is also not prepared to pay much more than $700/t cfr, which would net back to around $650/t fob at most. US buyers, aware of the situation in Asia and Turkey, have reduced their slab bids considerably, to around $740-760/t cfr, sources say, for Brazilian material. This may lead to Brazilian slab being offered in the eastern hemisphere again, pressuring CIS suppliers' positions down further, traders note.