- Nov-Dec shipments from China priced below current South Korean levels
- Weaker Korean won partly offsets impact of lower dollar-denominated offers
Chinese stainless steel suppliers have reduced offers for November-December shipments to South Korea, bringing them below prevailing domestic and import-substitute prices and reviving concerns over downward pressure on the South Korean market.
Market participants said the latest offers are being quoted below current market levels, particularly for 304 stainless steel. However, the recent movement in the Korean won has partly offset the impact of lower dollar-denominated offers. The KRW/USD exchange rate has moved back to around KRW 1,380/USD, compared with approximately KRW 1,340/USD in early September, making imported material relatively more expensive in won terms.
Chinese offers fall below Korean market levels
Chinese suppliers are offering 304 cold-rolled stainless steel at around $2,250/t delivered, while 304 hot-rolled material is being offered at approximately $2,100/t for November-December shipments.
In the Korean domestic market, November contract prices from importers have been reduced. 304 cold-rolled 2B, slit-edge material of 1.2-5.0 mm is being offered at KRW 3,215/kg ($2.32/kg), while 304 hot-rolled 1D, mill-edge material of 3-8 mm is priced at KRW 3,025/kg ($2.19/kg).
The 304 cold-rolled and hot-rolled prices are both around KRW 110/kg ($0.08/kg) lower than the previous month. Prices of 430 cold-rolled stainless steel have also declined by around KRW 40/kg ($0.03/kg).
Chinese 304 offers undercut import-substitute prices
Import-substitute 304 cold-rolled material in Korea is currently assessed at around KRW 3,250/kg ($2.35/kg). Against this level, Chinese 304 cold-rolled 2.0 mm material for November-December shipment is being offered at approximately KRW 3,215/kg ($2.32/kg), around KRW 35/kg ($0.03/kg) below the current import-substitute price.
The price gap is more pronounced in hot-rolled material. Domestic import-substitute 304 hot-rolled prices are currently around KRW 3,150-3,200/kg ($2.28-2.31/kg), compared with Chinese offers of approximately KRW 3,025/kg ($2.19/kg). This represents a gap of more than KRW 125/kg ($0.09/kg).
Weak demand adds to price pressure
The lower Chinese offers come at a time when bulk stainless steel demand in Korea remains subdued. Buyers are reportedly purchasing only small quantities and may delay procurement amid expectations of further price adjustments.
While the weaker won has provided some cushion against falling dollar-denominated import offers, Chinese prices remain competitive enough to put pressure on domestic and import-substitute material.
Note: This article is published as part of a content exchange agreement between SteelDaily and BigMint.
Leave a Reply