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| China's Domestic Steel Market Stuck In |
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China's domestic market prices of steel products are stuck in an accelerated downslide without hitting any bottom so far, it was learned in Tokyo late last week. Prices of more products have fallen by nearly Yn1,000/ton (US$147) one after another for the past one week. In China's Huadong area, market prices before tax have declined until now to Yn3,280/ton (US$482) for HR coils, Yn2,840/ton (US$420) for wire rods, and Yn3,990/ton (US$586) for steel billets. As a result, it follows that HR coil prices have receded to below Yn4,000/ton (US$500) for the first time since the latter half of 2006. The Huadong area embraces the three provinces of Jiangsu, Zhejiang and Anhui besides Shanghai. It is unknown what background lies behind China's domestic steel prices on a rapid downswing. One view is that a difficult collection of assorted orders despite reduced prices has brought repeated price reductions and disrupt market conditions. Another view points out repeated price cuts by steel distributors or small and midsize steelmakers for lack of buyers as sellers have proved abortive in their initial moves for realization sales. There is speculation, too, that the marketing divisions of various steel companies may have no option but to reduce prices for assured sales volumes under their management's instructions for increased sales. Meanwhile, Baosteel Co Ltd began to inform domestic customers on last weekend of the company's domestic sales prices for December shipments. It is likely that some contents of Baosteel's notice will come to light this week. |
| last modified : Thu 23 Oct, 2008 [10:51] |
