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| JFE Steel In Resumed HR Coil Export Talks With Hyundai Hysco |
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JFE Steel Corp is in resumed negotiations on its HR coil exports to South Korea's major steel reroller Hyundai Hysco for shipments in the October-December quarter of 2006. There are prospects of actual shipments in November 2005-January 2006. In the negotiations, JFE Steel is thought to have offered a concessionary price level to meet what South Korean integrated steelmaker Posco charges for its domestic shipments of HR coils after the recent price reduction by W45,000/ton. The Posco price reduction translates into a level of US$44/ton at an exchange rate of US$1.00-W1,020. There are suggestions that JFE Steel and Hyundai Hysco are putting emphasis on continued alliance and business relations between the two companies in the negotiations this time. It is possible for JFE Steel to retain the present contract price of US$600/ton FOB while seeking Hyundai Hysco's purchase of a practical maximum at US$600/ton FOB. But there are doubts about whether JFE Steel's insistence on the highest price level is essential to stable HR coil supplies for Hyundai Hysco as a shareholder in the Korean customer, with the going HR coil prices at US$450-460/ton FOB. JFE Steel has a 12.98% interest in Hyundai Hysco. In South Korea, steel rerollers as a whole are faced with excess stocks of bought-in HR coils at their works. The situation is believed to have followed imported supplies of low-priced HR coils from China and limited outlets for CR sheets from the Korean steel rerollers. Under the circumstances, most of the Korean steel rerollers see no pressing need to import HR coils anew from Japan except high-grade HR coils for applications such as automotive CR sheets and TMBP in tinplate production, according to market sources. |
| last modified : Wed 19 Oct, 2005 [11:30] |
