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| Japanese H-Beams Sell At $620-640 C&F For Nov Shipments To ROK |
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An integrated steel company of Japan has settled its deals of H-beam exports to South Korea at US$620-640/ton C&F for November shipments, compared with a high of US$680/ton C&F for October shipments. The settlement follows resumed negotiations with local customers. The negotiations started in late September on November shipments. But they were suspended until mid-October as various Korean users had taken a wait-and-see position around China's national foundation anniversary. There were H-beam offers from China to South Korea at around US$500/ton C&F before China's national foundation anniversary. In South Korea, Hyundai Steel Co executed a domestic price increase of W50,000/ton (US$43) for H-beams each in August and September. Later, though, the company retracted the price increase in September because of users' rejection, and executed a certain price reduction instead for a postsale adjustment. In this connection, the Japanese steel company is thought to have faced a fairly tough process of negotiations on its H-beam exports to South Korea for November shipments. But it is understood that the company felt no need to meet Chinese steelmakers' prices, given pressure only for a temporary price adjustment that may have arisen from Chinese export offensives at low prices. Also, the company saw no environment for a major price adjustment in US dollars, with an appreciating Korean won against the US currency. The Japanese steelmakers found it difficult to settle Korean deals of H-beams this time at US$650/ton C&F, the initial offer price. But there are cases of a negotiated price at US$640/ton C&F. As a result, it follows that the company has succeeded in avoiding a major price reduction. But chances are the company will face tougher price requirements from Korean customers in its H-beam export negotiations on December shipments as South Korea's various companies settle their accounts in December. Therefore, it is considered certain that the negotiations next time will come under hard going. In South Korea, meanwhile, general construction contractors are demanding postsale price reductions in rebar supplies from domestic electric steelmakers while rejecting payments for negotiated rebar purchases, given that low-priced rebar imports are available from China. It is a matter of attention how the current problem with rebar supplies in South Korea will be solved, in which there are fears of a ripple effect on the H-beam sector. As far as China's H-beam exports are concerned, there is a possibility that offer prices of around or below US$500/ton C&F will occur for November shipments to South Korea, according to market sources. In that event, there are forecasts that South Korea's various construction companies will seek retroactive price adjustments when it comes to purchases of H-beams from domestic steel mills and ones of imported H-beams. |
| last modified : Mon 26 Oct, 2009 [10:20] |
