Friday, March 11,
Steel prices in China extended a month-long decline this week, with demand being low, end-users are well-stocked and traders are unable to find the credit to pay for a new round of purchases..*
“The prices will continue to fall until inventories start coming down,” said a Shanghai-based trader.
The price of the benchmark October rebar contract on the Shanghai Futures Exchange also fell this week, ending Thursday at 4,679 per tonne, down 4.4 percent from last week.
Industry experts are blaming not only the “monopoly” behaviour of iron ore suppliers but also the age-old structural problems within the industry itself. Chronic overcapacity has also eaten up industry’s profits and consolidation is now the only remaining option.
With margins down, the only relief for China’s steel firms has been a correction in iron ore prices. Spot prices for Indian 63.5-63 pct fines hit $200 per tonne in early February but have now retreated to around $180.
Imports in February stood at 48.64 million tonnes, down 29.5 percent compared to January, according to data issued by China’s customs authority on Thursday.
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