China's Baosteel is keeping almost all its prices the same for
November in a falling market, in a move that many see as an attempt by the
major steelmaker to steady prices.
The only price changes are for grain-oriented and non grain-oriented electrical
steel, which will see reductions of 600 yuan and 200 yuan per tonne
respectively due to weak demand.
“Baosteel wishes to hold the market,” a trader in Shanghai said,
although he added that the company was likely to reduce its prices in December.
Baosteel's prices for commodity-grade hot rolled coil remain at 4,962 yuan
($780) per tonne excluding 17% VAT, well above spot prices.
In the Shanghai market, the product was trading at 4,460-4,550 yuan per tonne
for 5-12mm material, down 250-300 yuan from a month ago.
Baosteel's cold rolled coil prices will also hold steady at 5,516 yuan per tonne.
Spot prices for the same material are at 5,410-5,430 yuan per tonne, down 20
yuan from four weeks ago.
Cold rolled coil prices have softened since early September due to a
flagging performance from the automotive sector.
China manufactured 1.36 million automotive vehicles in September, down 2% from
August, with sales dropping 3.5% to 1.33 million units, China Assn of
Automobile Manufacturers said.
Market participants remain concerned about the outlook.
“Commercial hot rolled coil prices will probably drop to 4,100-4,000 yuan
in the fourth quarter if market does not improve,” a trader in Tianjin
said.
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