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|Major Upswing Considered Certain In East Asia's Ni-Based Stainless Market|
A major upswing is considered certain in East Asia's stainless steel market for nickel-based CR sheets that has undergone a complete change of the environment since late last week. Japan's stainless steel producers are flooded with various customers' requirements of Ni-based CR sheets from Japan right after LME nickel prices moved up to a level of US$8.00/lb Dec 22. The customers are thought to have concluded that the current prices of Ni-based CR sheets represent their lowest level. None of the customers responded when the Japanese steelmakers offered their exports at US$2,700/ton C&F.|
At present, the Japanese steelmakers find themselves busy turning down what they are requested to provide on the argument that the term of validity has already expired for their recent offers. They are expected to offer a price increase of around US$300/ton to US$3,000/ton C&F in their export deals of Ni-based CR sheets after Japan's New Year holidays in 2010.
China's major player
Taiyuan Iron & Steel Group Co (Tisco), one of China's five major stainless steel manufacturers, increased its domestic sales price of Ni-based CR sheets last week by Yn200 (US$29) to Yn21,220/ton (US$3,118) after tax, the first price increase since the beginning of December. Tisco executed a price increase of Yn200 in November as well. As a result, a cumulative price increase has amounted to Yn400 (US$59) so far. The company's sales price differs little from the current Wuxi market assessed at Yn21,200/ton after tax. The company is forecast to execute a major price increase this week after LME nickel prices rose to a level of US$8.00/lb.
In this connection, there are forecasts that South Korea's Posco and Taiwan's Yieh United Steel Corp (Yusco) will offer price increases of US$200/ton or beyond shortly in their export deals of Ni-based stainless CR sheets. Both companies' current export prices are estimated at a level of US$2,600-2,650/ton C&F, a price level that pales beside the cost burden of raw materials.
Various users in Asia have a distrust of LME nickel prices even after the prices hit a level of US$8.00/lb. They are apprehensive that LME nickel prices may plunge at any time. In the background are large LME nickel stocks of 150,000 tons in total.
On the contrary, China's stainless steel manufacturers see a high probability that LME nickel prices will trend upward at least until April even though the prospects from April onward are difficult to forecast. In a normal year, LME nickel prices come down to their lowest level in December and then they turn up in the January-February period of next year.
China's stainless sheet stocks, production
In the Wuxi area, total distribution stocks of stainless sheets increased to 194,000 tons in late December, up nearly 10,000 tons from early December. In contrast, users' stocks of stainless sheets are said to have further decreased until now. Therefore, various users are forecast to take action in haste, stocking up on what they need.
Meanwhile, China's five major stainless steel manufacturers put out a total of 560,000 tons of Ni-based sheets in November. Of the total, CR sheets accounted for 266,000 tons, and HR sheets 294,000 tons. In October, the five companies' Ni-based sheet production totaled 238,000 tons as CR sheets and 326,000 tons as CR sheets.
|last modified : Thu 07 Jan, 2010 [10:27]|