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ITSS and POSCO Competing Across Asia Over SST CR Steel
With the future direction of the LMI nickel (Ni) price---whether it will recover to $6 per pound or stay at $5--- remaining unclear, the prospect of the price of Ni-base, cold-rolled (CR) stainless steel (SST) also remains unforeseeable. Under such circumstances, competitions between South Korea's POSCO and PT Indonesia Tsingshan Stainless Steel (ITSS) over the product are reportedly being intensified.

The Ni-base CR SST price in the Wuxi market, China, is currently 16,500 CNY ($2,460, tax included) per ton, up by 700 CNY ($104) compared to February. However, in the Asian region, the price is about $2,040-2,050 CFR, which has risen only slightly given the LME Ni price per pound hit the $6 mark at one time. The price of ITSS's CR is said to be $100 lower than the price, at about $1,950 CFR.

Since ITSS began exporting Ni-base CR in earnest, its price war against POSCO has been intensifying in many countries amid the lingering uncertainty in the market. In Thailand, the competition between ITSS and POSCO's local subsidiary POSCO-THAINOX ("Thainox") has reportedly become harsher. Thainox imports HRC from ITSS to compete against the imports of CR to Thailand from ITSS. The import price of HRC is said to be about $1,850 CFR. It is not very common that the same companies supply both HRC and CR and are involved in competitions like this.

POSCO also runs against ITSS over CR at its home. South Korean re-rollers have imported HRC from ITSS to produce and sell CR. In response, POSCO has imported Ni pig iron and sell it as SUS304GS at a low price. The production volume was reportedly about 10% of POSCO's entire SST production at first; however, it now accounts for 40%, according to a source.

Which of these two giants is at a superior position at present is unknown. The focus of attention is on what move China would take. The Chinese government is currently conducting an anti-dumping (AD) investigation over SST sheet against Japan, South Korea, Indonesia, and some other countries. An open hearing is scheduled on 29 March, and the Chinese government is expected to reach a provisional decision in April. If ITSS is squeezed out of China, the competitions between POSCO and ITSS in other countries including Vietnam would become even fiercer.
last modified : Wed 20 Mar, 2019 [11:10]
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