News Room - Steel Industry

Posted on 02 Oct 2009

Export prices of Chinese structural steel drop further

Export prices of Chinese structural steel have declined by another $20 (Dh73) to $30 per tonne, making the product more competitive in the UAE market.

 

Hot rolled coil is now priced between $530 and $540 per tonne. Plates have come down to $550 per tonne. Two weeks ago, China was exporting plates at $570 per tonne, angles at $550, beams at $570, hot rolled coil at $560 and galvanised coil at $770 per tonne.

 

According to industry, officials and traders, imports from China would pick up after the end of the Chinese holiday season on October 8.

 

Karel Costenoble, Manager at the UAE-based Mesteel, said the market is quiet at present, awaiting the return of the Chinese.

 

"The Chinese are dominating the market and it remains quiet because of the Chinese holiday from October 1 to 8. People will not buy unless the Chinese return to the market," he said.

 

Emirates Business had earlier reported that the Chinese products that remained expensive until the end of July were getting attractive following a significant reduction in prices. "The prices have fallen further during the past two weeks as a result of increased production in China," said Costenoble.

 

Another trader said that they are waiting for the prices to fall further before placing orders. "It has gone down so much during the past few weeks and could fall further, especially as the demand worldwide continues to remain low," he said.

 

Importers in many other countries are also in a wait-and-watch mode over bringing in steel from China.

 

Reports indicate that South Korean importers are holding back orders and watching the continuous price fall. They think the price trend may be unravelled in mid-October, citing most Chinese H-beam producers' plans of overall production after October 12.

 

However, China Logistics Information Service Centre said prices could soon edge up. A recent report by Mysteel.net said quoting the centre that Chinese domestic steel price has dropped since early August. But after a month of adjustment, it could edge up firmly again.

 

According to data from National Bureau of Statistics of China, the nation's August crude steel output totalled 52.327 million tonnes, up by 22 per cent, while the accumulated output of steel products was 61.983 million tonnes, an increase of 28.9 per cent year-on-year.

 

China's steel products output has been above 60 million tonnes for three consecutive months since June. The country's daily production reached 1.688 million tonnes of crude steel and 1.999 million tonnes of steel products in August, both hitting a record high.

 

As for China's steel export, it totalled 2.08 million tonnes in August, down by 72.9 per cent year-on-year, but up by 15.1 per cent, or 0.27 million tonnes, compared to July, setting a monthly new high this year as per the customs statistics.

 

UAE production levels, too, have been increasing during the past two months.

 

Emirates Steel said steel output and sales during the third quarter increased compared to the previous quarter. According to reports quoting Ahmad Al Dhaheri, Assistant Vice-President for projects, the mills were "ramped up" during the second quarter, enabling the company to increase its production to full capacity of 1.8 million tonnes per year.

 

Hussein Al Nowais, Chairman of Emirates Steel, recently told this newspaper that August witnessed the highest production level at 170,000 tonnes.