Prices in international market have remained unchanged over last week as market has entered in to wait and watch mode.
Imported HRC offers from China have remained unaltered in the start of November month as Chinese steel mills are unwilling to bear further losses.
Offers from Japan and Korea have also followed same trend as that of China and has remained stable over last week.
Current offers for 2.5 mm HRC (grade: SS400) from China is being assessed at USD 285/MT, USD 320-325/MT from Japan/Korea, and USD 295-300/MT from Black Sea. All prices are on CNF India basis.
0.9 mm CRC is being offered at USD 310/MT from China, USD 390/MT from Japan/Korea. All prices are on CNF India. While offers from Black Sea, FoB are heard at USD 330/MT.
It may be noted that Japan/Korea attracts basic custom duty of 0.8 and 1.2 % respectively, where as other countries (Excld ASEAN countries) attract basic custom duty of 12.5% on flat steel.
Possible Production Cut by Chinese Steel Makers
According to CISA (China Iron and Steel Association), major steel producers in China suffered total losses of 28.12 billion Yuan (USD 4.42 billion) in first three quarters of 2015.
China’s one of the largest steel producer, China Steel Corporation (CSC) recently announced that it will keep its prices unchanged for December deliveries after eight months of continuous price cut.
In order to address the issue of oversupply in Chinese steel industry, steel mills have resorted to production cut. China’s crude steel output fell by 3% Y-o-Y to 66.12 MnT last month.
Furthermore, it is reported that Chinese steelmakers are planning further cut in production in coming months. This move will help steel mills to clear inventories and stabilize prices in the oversupplied market.
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