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| China's Stainless Major Tisco Gives Notice On |
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China's major stainless steel manufacturer Taiyuan Iron & Steel Group Co (Tisco) has served notice to various domestic customers this week on what the company describes as "a bottom price" for November shipments of nickel-based stainless steel products, it was learned in Tokyo Thursday. It is understood that the company is determined to shun any more price reduction in its domestic deals after one of around Yn8,000/ton (US$1,176) this time. For November shipments, Tisco sets the new prices after value-added tax at Yn16,500/ton (US$2,426) for Ni-based HR sheets and Yn17,700/ton (US$2,602) for Ni-based CR sheets. China's stainless steel majors such as Tisco have production cutbacks in effect of 30-50% at their works, with a cutback of as much as 50% in most of their operations. With domestic market prices of stainless steel still continuing fall, Tisco is thought to have presented local customers with its new prices as if the company was standing on the edge of a cliff. China's demand season for stainless steel usually starts in December of each new year to meet export sales of kitchen utensils made with stainless CR sheets. Local demand for stainless steel in 2009 is expected to arise after the lunar New Year holidays (Jan 24-31). There are expectations that if Tisco's new price policy proves successful and a bottom price takes hold, purchasing intentions will arise among local users, leading to an advance in China's domestic stainless steel market. At present, the world's stainless steel producers are in various moves to reduce what they put, but falling prices of stainless steel have yet to stop. In Europe, transaction prices of Ni-based CR sheets are 2,300 euros/ton for November shipments and 2,100 euros/ton for December shipments. In the USA, the current domestic prices stand at a level of US$2,900/ton, the price level that will come down to US$2,800/ton in January due to a reduction of the surcharge. In Asia, the existing bids are around US$2,500/ton FOB, but a reduction of the bids by US$200 or so is see as necessary to bring a firm deal. South Korea's stainless steel producers are positive in promoting exports of what they put out, but offer prices are subject to major fluctuations in an unstable value of the Korean won. As a result, various customers are said to be indicating lukewarm interest in taking Korean products. In the case of China, offers of export shipments by the nation's stainless steel producers are limited, while there are frequent cases of export offers by local steel distributors for realization sales with specified discounts. Nevertheless, it is considered fairly difficult to work out export deals as various customers are out to avoid increasing stocks of bought-in materials in relation to December book closings. |
| last modified : Wed 03 Dec, 2008 [10:17] |
