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|Export Of Cold-rolled Steel For Asia To Close Shop For August Shipment Next Week|
Export negotiations on cold-rolled steel sheets/coils for Asia will end for August shipment next week. The circumstances are the worst. Bidding price remains unchanged at the level of July shipment, but it is far below the level acceptable to the Japanese mills. A customer has not shown an interest in purchasing cold steel, and therefore, information on conclusion of contracts are not reported even if an overseas mill cut its price. A seller side is close to impossible situation to cut its price further under cost increase of materials.|
In the overseas market, price of cold steel is $720 to 750 FOB and $780 C&F or so, and the situation remains unchanged from that for July shipment. Deadlocked negotiations have continued for one month. Under the circumstances, as it is impossible for the mills to continue negotiations for August shipment, they are going to close business talks within next week, and to stand by for businesses of September shipment onward. The Japanese mills seemed to have received small amount of orders same as July shipment, and have concluded contracts with quite limited customers except for the tied customers.
According to the seasonal factor that the period of July through September is the summer holiday season, usually, demand on steel plunges. However, in case of cold steel, the Christmas related cold steel demand on electrical appliances and so on in Western countries is active in general compared with other steel items. Therefore, the blast furnace mills had expected increase in export of cold steel to some extent.
However, their expectation fell through in this quarter. The mills like Chinese and Korean re-rolling mills other than the Japanese ones seemed to cut their prices, but no customer showed an interest. Customers have sufficient inventories, and therefore, do not need to purchase cold steel even if cheaper price is proposed. From last week, POSCO has started negotiations. Its price is said to be the level of $780 C&F which is almost similar to the market one. Attention is paid whether POSCO will secure orders to what extent after the Japanese mills withdraw from negotiations.
While, it is almost certain to recover rapidly demand on cold steel in Japan. Recovery of the automotive industry will lead it. Expected annual car production is more than 10 million. Consequently, to meet its demand, the mills have to increase awfully their production. It is believed that limitation of cold steel export will be directed for September shipment onward by an executive in charge of sale of the mills. This seems to be one of backgrounds to withdraw from negotiations for August shipment.
|last modified : Thu 14 Jul, 2011 [10:28]|