China major steel product price index Feb 21 to 25 2010

Thu, Mar03, 2011

Product	Size	Previous week	This week	Change
Common wire rod	6.5	142.12	140.83	-1.29
Rebar	12-25	141.36	140.28	-1.08
Medium plate	6	135.46	135.96	0.5
HR sheet	1	142.42	141.58	-0.84
HR coil	2.75	132.91	132.05	-0.86
CR sheet	0.5	121.92	121.45	-0.47
Galvanized steel sheet	0.5	116.87	117.07	0.2
Seamless steel tube	159*6	121.36	122.36	1

17% VAT Included

China Iron & Steel Association launched Major Steel Product Price Index in April 2001. The index is compiled from prevailing transaction prices for eight steel products in 23 major cities. April 1994 is designated as the benchmark point with fixed index value of 100.

(sourced:mysteel)

Tags: CR sheet, galvanized steel sheet, seamless pipes,

China’s HRC output soars in 2010 on capacity boost

Monday, Feb14, 2011

The boost in hot rolled coil capacity witnessed in China through 2009~2010 prompted the country’s HR coil and sheet output last year to surge to 144.63m tonnes, according to National Bureau of Statistics data. This was up by a significant 25.93mt or 22% from 2009’s 118.7mt.

Steel Business Briefing notes that, in 2010 alone, a combined 14m tonnes/year of new HRC capacity was brought on stream, and this year a further 6m t/y will be commissioned. Indeed, China’s HRC output will continue climbing this year in any case as those newly-started hot strip mills gradually reach full operation.

Remarkably however, though HRC output is trending upwards, HRC prices have also climbed since early last September – driven both by Chinese inflationary pressure and by increasing raw materials costs.

Among Shanghai dealers for example, Q235 5.5mm HRC prices have reached RMB 4,780/t ($729/t) with 17% VAT, or RMB 4,085/t without VAT, up almost RMB 800/t from last September.

And because HRC supplies to the domestic market this month will be temporarily affected by maintenance stoppages at some mills, prices will likely climb further after traders resume business on 9 February after the Chinese New Year break.

For example, northern China’s Anshan Iron & Steel will lose about 250,000 tonnes of pig iron output this month due to blast furnace maintenance, denting HRC output as a result. Maintenance on one of its hot strip mills this month will lose east China’s Shagang about 300,000 t of HRC output. Angang and Shagang have informed their trading agents that their February HRC deliveries will only be 35% and 28% of contracted volumes respectively.
(sourced:SAC International Steel,Inc.)

ASSOCHAM calls for raising import duty on HR steel

Sunday, 06 Feb 2011
The Associated Chambers of Commerce and Industry of India in the interest of domestic steel Industry has stressed upon raising the import duty on hot rolled coils from prevalent 5% to minimum 10% to encourage the growth of domestic steel industry.ASSOCHAM feels that pro active policy measures adopted by Government of India can help expand the HR capacity by additional 8 million tonne during 2011-12, making India surplus for HR by more than 6 million tonne.In a proposal to the ministry of finance, ASSOCHAM has urged the government to raise import duty on HR minimum by 5%. It is imperative to mention that India used to be a net exporter of HR during the last decade but it has become a net importer since past 5 years and has already imported around 2 million tonne of HR Coils in the current financial year. China along with CIS accounts for almost 75% of total imports.ASSOCHAM has pointed out that excess capacity coupled with cost competitiveness are fundamental reasons for export of primary input raw materials for manufacturing steel ie iron ore, coking coal. Coking coal contributes approximately 50% of total cost while 20% cost is contributed by iron ore.Countries like China and CIS with excessive raw material resources are cost-competitive in the international market. China stimulates exports by giving an export incentive of 9% on HR Coils, on the contrary coking coal pries have increased by over 100% thereby, pressurizing cost-competence of Indian steel producers.ASSOCHAM has also outlined four fundamental factors that present adverse scenario for Indian steel companies producing HR Coils - excess capacities in China and CIS countries, cost competitiveness due to cheap source of raw material esp. coking coal, 9 %incentive given to Chinese exporters, new HR Coil capacities developing in India.

HRC prices surging in Latin America and Middle East

Thursday, 27 Jan 2011
TEX reported that market prices of HR coils are surging for sales into the world's destinations such as Latin America and the Middle East, a situation where the going prices are believed to have already topped USD 800 per tonne CNF. But there are no signs of negotiated deals so far amid an intense upward mobility in prices.In the case of Latin America, a surge in HR coil prices relates to a surging domestic market for HR coils in the USA. The nation's current HR coil market is reported as a level of USD 780 per tonne, with a high of USD 800 per tonne, caused by a soaring ferrous scrap market there besides a certain level of HR coil demand.

There is information that electric steelmakers such as Nucor Corp and some integrated steelmakers will further increase what they charge for HR coils to a level of USD 870 per tonne for March shipments. The USA's domestic HR coil market stood at a level of USD 620 per tonne in late November last year, but it went up to USD 700 per tonne in early December and to USD 750 per tonne in late December. Also, it has further advanced to a little less than USD 800 per tonne since the beginning of January 2011.US steelmakers are main suppliers of HR coils to Mexico and elsewhere in Latin America. As a matter of course, the USA's soaring HR coil market has repercussions on deals of HR coil supplies to Latin America, where HR coil prices are subject to violent fluctuation because local supply sources are limited in number. A similar situation exists in the Middle East when it comes to HR coil supplies.

Transaction prices of HR coils for the Middle East have yet to hit USD 800 per tonne CNF. But a certain Asian steelmaker is reported to have offered HR coil sales to the Middle East at USD 750 per tonne FOB for March 2011 shipments.Negotiations on new deals of HR coil supplies are under way in Asia as well in what amounts to front loaded ones for shipments in the April-June quarter, given an upswing in quarterly price renewals of raw materials. In this connection, there are signs of the world's spot prices on track to top USD 320 per tonne FOB for coking coal and USD 180 per tonne for iron ore in the April to June quarter, a surge in the raw materials prices that is reminiscent of what happened in the April to June and July to September quarters of 2008, during which time HR coil prices exceeded USD 1,000 per tonne FOB.

The world's various steelmakers are contemplating seeking increased prices of HR coils in what they sell. As a result, it is uncertain how far their offer prices of HR coils will move up, a situation where it is considered difficult both for the steelmakers and their customers to work out a compromise.As far as Japan's integrated steelmakers are concerned, they have shortened the contract period of their HR coil exports to a monthly or quarterly settlement until now, a break with their half-year supply contracts in the past. A half year supply contract would permit a price increase twice a year. But a monthly or quarterly contract would necessitate any pass along to apply all at once for a monthly or quarterly provision.

It is certain that the Japanese steelmakers will seek a three-digit price increase in the renewal of each monthly or quarterly contract. But it remains to be seen whether they will offer a price increase of USD 150 per tonne, USD 200 per tonne, or more.In Asia, meanwhile, market sentiment has yet to follow a surge in HR coil prices. Taiwan's China Steel Corporation is contemplating executing a domestic price increase of HR coils by only TWD 973 per tonne so far for March 2011 shipments. By comparison, moves of South Korea's POSCO are unclear in relation to the company's HR coil prices for domestic sales. Still, it is considered possible for POSCO to win a virtual price increase of HR coils with a reduced discount.

In Vietnam, a price level of USD 700 per tonne C&F is still seen as the norm of what local users require on price for HR coil imports. Under the existing circumstances, however, there is no doubt that transaction price of HR coils will fast advance across Asia over time.
(Sourced from TEX Report Limited)