Slab Scarcity Drives Indonesia Steel Prices to New Highs

The Indonesian steel market is currently seeing a major price rally. Driven by raw material shortages and geopolitical disruptions, HRC prices hit new highs on April 13, 2026. But despite the strong mill offers, buyers are pushing back, leading to a pricing standoff in the market.

HRC Prices: The Rally Continues

The momentum in the Indonesian HRC market remains undeniably bullish. Major blast furnace mills have aggressively raised their quotations for future shipments.

SAE 1006/SS400 (3mm): Current offers for July shipments are hovering around $605/t CFR Jakarta/Surabaya.

SPHC (2mm): Local mills are targeting $640 to $670/t CFR for June and July deliveries.

To put this in perspective, these levels represent a significant jump from late March, when transactions were still being finalized at $580/t CFR. Just a month ago, in mid-March, the market was trading near $560/t CFR. This rapid appreciation highlights a “hot” market environment, though high prices have led to a noticeable slowdown in actual transaction volume.

The Root Cause: A Global Slab Shortage 

Supply chain disruptions are overshadowing local demand as the main driver of high prices. Indonesia is facing a severe slab crunch following the loss of Iranian imports. Due to geopolitical risks, these vital supply contracts have been scrapped or put on hold, forcing producers to scramble for alternatives.

Key Slab Market Indicators:

Stagnant Local/Regional Supply: With both Indonesia and Vietnam quoting $540/t FOB, regional slab prices remain high, deterring local buyers.

Strategic Sourcing Shift: The shortage has forced a massive pivot toward Chinese resources to keep production lines running.

Heavy Booking Volume: Market activity has surged in the Chinese sector, with over 100,000 tons of SPHC slabs secured in the $471–$475/t FOB range—a significant jump from early March levels.

With freight costs from China to Indonesia currently sitting at $28–$30/t, the landed cost of Chinese slabs is now significantly higher than the levels seen in early March ($465/t CFR).

Export Trends and Regional Outlook

While domestic prices are rising, Indonesia’s export performance has seen a temporary dip.February trade data shows a massive 60.2% month-on-month contraction in HRC exports (131,000 tons). While volumes remain 10.2% higher than last year, the sudden monthly drop highlights a cooling export drive. Local mills are likely pivoting to the domestic market while navigating the growing complexities of EU carbon border taxes.

Broader Southeast Asian Context

Indonesia’s market trends are part of a broader industrial surge across the ASEAN region：

Philippines: SteelAsia is nearing the completion of its Batangas section mill, which will mark the country’s first-ever domestic production of structural steel.

Vietnam: The Hanoi–Quang Ninh high-speed railway officially broke ground on April 12, signaling long-term infrastructure demand for the region.

Europe: ArcelorMittal’s Mardyck plant in France just rolled its first electrical steel coil, a move that could impact global high-end steel flows.

Summary for Market Participants

The Indonesian steel sector is currently defined by cost-push inflation. While the “sticker price” for HRC is high, the actual market liquidity is being tested by the lack of affordable slabs. For traders and procurement managers, the coming weeks will be a balancing act between securing high-cost Chinese feedstock and waiting for a potential stabilization in global logistics.

Market Insight: Expect HRC prices to remain supported at these high levels as long as the slab deficit persists. However, watch for a potential “wait-and-see” approach from end-users who may resist prices exceeding the $650/t mark.