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Negotiations on Ship Plates for Korea Start as Early as Mid-Dec
The Japanese mills are expected to commence negotiations on steel plates for shipbuilding for Korea for shipments of the next quarter as early as Mid-December. At the time of negotiations, their targeted shipments are on quarter basis (January-March) this time as well but it is thought that they are prolonged and shipments become a half year (January-June) again.

Preceding the Japanese mills, Chinese mills seem to have entered negotiations for shipments of the next quarter with Korean major shipbuilders. Information is not much but it is reported that the Korean side is requesting a large decrease in prices.

Against the backdrop that Korean shipbuilders are requesting a substantial decrease in prices, first, vessels to be delivered next year were contracted in 2012-2013 at very cheap prices, and moreover, shipbuilders are intending to reduce their purchase quantity due to having a lot of inventory of plates. In addition, it is mentioned that the overseas market prices of plates have not ceased to fall yet and prices of raw materials like iron ore tend to fall next quarter as well.

There is information that the Korean side is requesting a decrease in prices by $30-50 against Chinese mills. If so, the plate prices are thought to dip below $550 FOB which are the level that not only Chinese mills but also the Japanese mills are difficult to accept.

Negotiations on plates for Korea have been always bogged down and prolonged. Negotiations of this time are likely to be burdened with more difficult issues than ever.

Meantime, the Japanese mills' negotiations on plates for shipments of the latter half year (July-December) have not been settled yet. However, as negotiations between the Korean blast furnace mills and shipbuilders were already settled, the Japanese mills' ones are expected to be settled without taking some more time.
last modified : Fri 05 Dec, 2014 [10:04]
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