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Prices Of Hot Coils For Middle East To Stabilize At $700 CFR For May/June Shipment
Negotiations on hot-rolled steel coils for Middle East will start soon for May/June shipment, and those prices are foreseen to continue to stabilize from April/May shipment as the situation is stable and any factor of raising or lowering prices is not found.

In the Middle East area, if sanctions are imposed against Iran by the USA, there was an observation that export of hot coils for Iran from the Russian mills would be ceased, and as a result, the market would be weakening from concern on the Russian mills' making inroads into other areas in Middle East. However, there is no such move, and the Russian mills are offering $700 CFR with markups of $5 from those in the past which is said to be no fluctuations from $660 to 680 on FOB basis.

A Egyptian mill is reported to be offering hot coils of which prices are $700 CFR or $730 to 740 CFR being inclusive of extras. This level also has not changed.

Among the Asian mills, the Korean ones have still been inactive for Middle East. There will be no remarkable moves of POSCO because the periodic maintenances of hot rolling mills are scheduled to be made in April in Pohang Steel Works and in May in Gwangyang Steel Works. It is said that in Middle East there are offers at $680 CFR from Japan. However, such offers have not affected the market due to spot offers of hot coils which are seen from an electric furnace mill.

Negotiations have been proceeding mainly based on the position of supply and demand. So far, there are no customers to be found that bring price down due to decline in prices of raw materials for a blast furnace or a lull in strong yen into negotiations. To that extent, the position of supply and demand is stabilizing in the Middle East area.

Meantime, for the Japanese mills, even the level of $700 CFR is not sufficiently profitable. However, as there are no factors to raise prices or to anticipate a future rise, and also there are no requests for price down from customers, negotiations for May shipment are likely to be settled in a short time.

While, there is less movement in Central and South America as well as in Middle east. In the US steel market, although the US mills raised their prices of flat products by $30 in early March, such price increase had not been reflected on the market of which prices of hot coils are said to have dropped in last week as well. Nevertheless, such declining in the US market has not affected the markets in Central and South America.
last modified : Wed 04 Apr, 2012 [12:45]
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