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Integrateds In EG Sheet Export Talks With Japanese Users For Apr-Sep Shipments
With flat prices on offer, Japan's integrated steelmakers have begun negotiations on their exports of electrolytic galvanized sheets to Japanese-affiliated consumer electronics manufacturers operating in the rest of Asia for shipments in April-September 2006.

The Japanese-affiliated customers want price reductions for the EG sheets they import on grounds of falling prices for various steel products. Besides, they see the prospects of a fall in prices as to the Japanese integrated steelmakers' negotiated imports of essential raw materials such as iron ore. It is understood that the customers are set to demand at least a three-digit price reduction like US$100/ton.

The Japanese steelmakers are reacting negatively, though. They argue that they have yet to conclude import price negotiations on iron ore for fiscal 2006 (April 2006-March 2007). They also point out that supply-demand conditions for EG sheets show no visible signs of a slack, which they claim amounts to no environment for a major price reduction.

In Asian markets, there are EG sheet offers from South Korea's steel rerollers and integrated steelmaker Posco at fairly low prices of around US$530/ton C&F. But those offers represent "abnormal moves" irrespective market conditions for EG sheets, according to Japanese steel industry sources.

In this connection, the Japanese steelmakers are contemplating rejecting any request for a price reduction to meet the Korean offers in their EG sheet export negotiations with the Japanese-affiliated users in Asian destinations. As a result, the Japanese steelmakers are likely to face a prolonged process of their negotiations under way.

Meanwhile, the Japanese steelmakers are being requested to execute major price reductions in their GI sheet exports under negotiation with Japanese-affiliated consumer electronics companies operating in Asian destinations. The negotiations started late last year for shipments in April-September 2006.

The Japanese-affiliated users want major price reductions on the basis of domestic price practices for GI sheets by major Chinese steelmakers such as Baoshan Iron & Steel Co. But the Japanese steelmakers point out that the Chinese price practices amount to none of the ruling GI sheet prices in Asia. Besides, the Japanese steelmakers find it difficult to apply uniform price terms in the GI sheet exports they negotiate to China and Southeast Asia because the going GI sheet prices in both destinations differ much from each other. As a result, the Japanese steelmakers have yet to conclude their negotiations with the Japanese-affiliate users.
last modified : Fri 10 Feb, 2006 [10:54]
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