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Negotiations on GO Elec Sheets Pass Peak at $200-350 Increase for 1st Half Shipt
The Japanese mills' negotiations on grain-oriented (GO) electrical steel sheets mainly for Europe and the USA seem to have passed a peak for shipments of the 1st half next year (January-June). Although there is some mill to leave negotiations with a biggest customer, prices are seen mostly to have been settled at an increase by $200-350. As a result, they are likely to have realized a price increase by $600 or so this year. Prices of GO electrical sheets fell by as much as $1,000 for a year of 2 years ago. They are to be recovered by half this time at long last.

The mills to produce high-quality GO electrical sheets could proceed with negotiations this time almost without competition each other. It is because as a production capacity of each mill is limited, each concentrated on negotiations with its very important customers and did not seek other customers. Korea's POSCO and China's Baoshan Iron & Steel (Baosteel) are reported to have initially raised their offer prices by $500 but the level of their contracted prices is unknown as they did not compete with the Japanese mills.

Baosteel seems not to have been so aggressive for export. There is a possibility that the company was all tied up for the domestic market due to the strong demand to upgrade the electric power grid in China. Inquiries from China were even sent to the Japanese mills.

Negotiations have passed a peak, and many customers that could not purchase high-quality GO electrical sheets appeared. There will be no mills to ramp up a production capacity of prime quality GO sheets for the moment in Korea and China as well as Japan. Accordingly, customers that will not be able to purchase high-quality GO sheets will exist in the latter half of the next year as well. There is a possibility that lack of such quality of products may get worse further.

With a price rise of high-quality GO sheets, prices of CGO (conventional GO) electrical sheets for general use also seemed to rise. A source is saying that prices of them might be raised at least by $100-150. As the Japanese mills concentrated on negotiations for high-quality products, they tend to lack information for CGO sheets. Meantime, a Russian mill has not aggressively proceeded with negotiations for the Middle East and also Asia. The reason is unknown but there is an observation that a trouble in its facility might have happened. While, European mills are likely to stay at negotiations within the region despite of the weak Euro.
last modified : Tue 16 Dec, 2014 [11:07]
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