- High Chinese offers erode Korean import price competitiveness
- POSCO pricing decisions key to near-term trade flows in Korea
SteelDaily: China’s stainless steel market entered a rare price-reversal phase in mid-January. Following a sharp rally, Chinese domestic prices now exceed Korean imported and domestically produced (GS) prices.
In the key Wuxi hub, Chinese 304-grade cold-rolled prices climbed up to RMB 14,550/t, remaining well above early-January lows despite a modest correction from the peak. In fact, Chinese domestic prices had surged from around RMB 13,850/t on 4 January to RMB 14,850/t on 7 January, before easing slightly on slower spot trading.
However, even after the pullback, Chinese domestic prices are equivalent to about KRW 3.08 million/t, making them over KRW 80,000/t higher than Korean market prices of imported and GS materials, which currently trade around KRW 2.95-3.00 million/t.
Meanwhile, in Korea, import offers from China for 304 CRC were heard at $2,100-2,150/t CFR, translating to a landed cost of roughly KRW 3.10-3.17 million/t at current exchange rates, even before inland logistics and financing costs. This effectively erodes any price advantage for imported material and has dampened buying interest.
Market participants said POSCO’s pricing strategy will be key to near-term trade flows. While higher imports look uneconomical at present, tight availability in certain thicknesses and declining inventories could still force selective bookings despite elevated exchange rates and high offshore offers.
Note: This article has been written in accordance with a content exchange agreement between SteelDaily and BigMint.
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