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Japanese BF Mill Offers Price Increase of Wire Rods for Asia by $50
= For shipments of the next quarter =
Some Japanese blast furnace (BF) mill has commenced negotiations on steel wire rods for Asia from this week for shipments of the next quarter (January-March). Its offer prices appear to be raised by $50 from current prices. A source is observing that markups of more than $30 will be expected due to still strong demand.

In China, it enters the production curtailment season in winter mainly in the Hebei Province. Xingtai Iron & Steel (with an annual production capacity of 1 million tons) of a leading wire rod maker in that province is said to cut its production quantity by 50%. Accordingly, the balance of supply-demand of wire rods is likely to become tight. Since late October, wire rod prices have exceeded those of hot-rolled (HR) steel coils. Baoshan Iron & Steel left its domestic prices of wire rods unchanged for December shipment but raised those of wire rods for the use of the automotive industry by 500 CNY ($74). Nanjing Iron & Steel is reported to have followed it.

Not only in China but also in the other Asian region, demand for wire rods is strong mainly for the automotive use. Taiwan's CSC set out before its domestic prices of steel products for contracts in February-April. The company raised its prices of HR coils by NT$214 ($a little over $7) while did them of wire rods by NT$641 ($22) which were the largest increase in prices among steel products. Korea's POSCO raised its domestic prices of wire rods by 200,000 won ($22) for shipments of January-March. As Chinese exports have stopped, the company is seen to have recovered its domestic prices. It is reported that as the company has given priority to domestic supply, it is inactive for export and is exporting only limited profitable items.

In each country, the supply of wire rods seems to become one of the tightest items. Under the situation, the Japanese BF mills are in an environment to be able to raise their prices also for next quarter.

Meantime, POSCO's wire rods to the USA are finally determined to be affirmative as a result of an antidumping (AD) investigation, and an initial AD duty was the level of 10%. However, such duty was revised this week to 40.8%. Seen from the duty rate, Korea's export of wire rods is seen to be difficult, and attention is paid to export destinations of that company in future.
last modified : Wed 06 Dec, 2017 [10:17]
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