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| Japanese Eyes On Baosteel's October Steel Prices For Domestic Sales |
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Japan's integrated steelmakers are set to watch what price terms China's Baosteel Co will apply in its domestic sales of various steel products for October shipments. There is no information so far as to when Baosteel will give notice to domestic customers on price terms of October shipments. Baosteel usually serves notice on monthly price terms around the 10th of each month or by the 20th of each month at the latest. Given the usual practice, there is a possibility that the company will serve notice Sept 10 this time at the earliest or within next week at the latest. Baosteel keeps its sales prices unchanged of main sheet products such as HR coils for September shipments. The company is thought to have opted for flat prices of main sheet products from several points of view ranging from the maintenance of its domestic market share to the protection of its customer base. But speculation is rife that the company may turn to pulling up what it charges for October shipments after its achievement of a certain earnings target for up to September shipments. At present, market prices of steel products in China are on the rise for items such as building materials and CR sheets. They are reported as fluctuating for HR coils. Small and midsize steelmakers tend to react with increased production of items selling for increased prices whenever domestic market conditions go up in prices. As a result, the course of things from a glut of steel products to a decline in steel prices has repeated until now. But it is likely that China's various steelmakers will respond differently from what they have done before when local steel market conditions have gone up in prices this time. The central government is committed to a stronger policy than the earlier one to achieve the targets set for energy savings and CO2 emission cutbacks. As a result, electric power supplies are restricted in various areas, while instructions to stop production are in effect as to steelmakers operating overage facilities. Accordingly, there are forecasts that small and midsize steelmakers will find it impossible to resume production from their works even if steel market conditions have advanced in prices. All things considered, some market observers believe that any advance in China's domestic steel prices could continue for a longer time than before thanks to less factors that may stem an upswing in steel prices. |
| last modified : Tue 14 Sep, 2010 [09:57] |
