4 MAYIS 2016
Global Steel Price Rally Continues
The MEPS world all products composite steel price surged by 9.2 percent, in April, to reach its highest point since September 2015.

In April, global steel values escalated for the fourth month in a row. European selling figures rose by 13.4 percent, in US dollar terms, compared with those in our last report.

Chinese mill offers, both at home and overseas, continued to soar, in April. This enabled South Korean and Taiwanese producers to lift domestic selling figures. Our MEPS Asian steel price rose by 8.6 percent, month-on-month. 

North American steel values also continued their upward trend, as regional figures increased by 6.7 percent, compared with last month’s prices. Local producers announced further list increases following several successful price advances earlier in the year. 

It is widely accepted that demand fundamentals largely remain unchanged. Therefore, supply-side factors are providing the boost to global steel values.

However, US crude steel production continued to rise, this month, as 72 percent capacity utilisation was registered, in mid-March, from around 60 percent, not so long ago. China’s crude steel output rose, year-on-year, last month, as rising domestic prices encouraged mills to ramp up production. 

Chinese steelmakers were, reportedly, focusing on selling in their local market, where values are higher. However, China exported 23 percent more steel, last month, compared with February, despite ramping up export offers. 

Other major exporters have followed China’s lead in hiking up their prices. Consequently, market participants are returning to domestic sources, who have pushed up their prices as a result. 

Furthermore, it is becoming increasingly evident that trade protection measures, specifically in the US, are starting to curtail imports and cause supply shortages.

North American buyers report that availability of cold rolled coil and galvanised material is becoming increasingly constrained, especially for non-contract customers, with one US buyer remarking that “cold rolled coil is like gold”, currently. 

Traders commented that they have limited supply options for downstream products, as US steelmakers successfully filed trade cases for flat products, giving ‘carte blanche’ to domestic suppliers to raise prices with little resistance. 

However, buyers have warned that, if figures continue to rise, they will look to find new import sources, not covered by trade cases, which could keep a lid on domestic pricing. 

To a lesser degree, EC trade cases for steel products are starting to bite across flat products, giving traders the impression that supply is tightening. 

Undoubtedly, protectionism restricts the choice for the customer and goes against the ethos of free trade. A delicate balance exists between safeguarding the strategic interests of a steel-producing nation against the unfair dumping of cheap imports, while giving the customer the opportunity to procure their material at competitive prices. 

Steelmakers have been forced to take decisive action, either by selective capacity cuts or by filing trade cases, as global selling values, slipped to their lowest level for more than a decade, at the end of last year. 

However, without any significant change in market demand fundamentals, MEPS believes that the current rise in transaction values, since the start of the 2016, is likely to be a short-lived phenomenon. We forecast that prices will decline later in the year.

Source:MEPS


DİĞER HABERLER