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|Posco's Major Domestic Markup For Stainless Sheets?|
Speculation is circulating that South Korea's integrated steelmaker Posco will voice a major increase Jan 29 at the earliest in what the company charges for its domestic shipments of stainless sheets in February. It is a matter of attention what level of a price increase will take effect. There are suggestions that Posco may price up nickel-based stainless sheets by W100,000/ton (US$87), given awareness of stainless steel imports into South Korea, or by an alternative W250,000/ton (US$220) to meet an advance in raw materials prices. |
It is likely that various customers in Asian nations will divert from a wait-and-see position each once Posco has taken the plunge and executed a considerable price increase in its domestic sales of stainless sheets. In that event, Asian market conditions for stainless sheets are forecast to show a further upswing in prices.
Asian demand for Ni-based stainless CR sheets is on the upswing, mainly in China, after a complete change of the environment since late last year. In China, there are no signs of a sudden downturn in the domestic stainless steel market for CR sheets even though local market prices of ordinary steel products are somewhat declining for building materials.
China's domestic stainless steel market used to react sensitively to fluctuations in the world's nickel prices. Until now, LME nickel prices have dipped, as shown by US$8.45/lb Jan 21 and US$8.30/lb Jan 27. But the stainless CR sheet market in the Wuxi area has changed little so far at Yn22,500/ton (US$3,309) after tax since the beginning of this year, which market sources believe indicates China's strong demand for stainless sheets. In the Wuxi area, distribution stocks of stainless sheets are said to have increased slightly to a total of 195,000 tons in late January, for which stalled local traffic in a heavy snowfall is held responsible.
Taiyuan Iron & Steel Group Co, one of China's major stainless steel manufacturers, executed a domestic price increase of Yn500/ton (US$73) for Ni-based sheets and that of Yn300/ton (US$44) for chromium-based sheets, each from Jan 19. Taiwan's stainless steel manufacturers have reacted with a domestic price increase of NT$2,000/ton (US$60) for their products and export price increases of US$80-120/ton for March shipments.
Under the existing circumstances in Asia, the current export prices of Ni-based stainless CR sheets from Taiwan and South Korea stand a level of US$2,800/ton C&F for delivery in China. As far as Japan's stainless steel producers are concerned, they are struggling to get a price level of at least US$2,900/ton C&F in their export deals of Ni-based CR sheets for shipments Asian destinations, with the target price level set at US$3,000/ton C&F.
Meanwhile, bids from Europe have begun to flow into Asia for imports of Ni-based stainless CR sheets from countries such as Japan and South Korea. The bids on FOB terms are seen as a level of 2,100 euros/ton or the equivalent of US$2,940/ton. In this connection, it is understood that the European stainless steel market has bottomed out, leading to purchases of supplies from without. Until recently, it was considered difficult to detect actual demand in Europe for stainless sheets. Also, there are signs of the USA's domestic stainless steel market on track to bottom out in February. The USA's current domestic prices of stainless sheets are estimated at a level of US$3,100/ton.
|last modified : Wed 03 Feb, 2010 [10:50]|