Steel Products
From the Inside: China Iron Ore and Steel Export Update
Written by John Packard
March 15, 2013
The following article is from one of our close trading sources located in Asia. This person is actively trading iron ore and ferrous scrap into China and is also trading steel out of China into Europe. He is able to provide us a view of the Asian market not normally seen by outsiders.
Here is what our trading source had to say on Wednesday of this week:
I think we are in dangerous times worldwide for Steel, Ore etc…, but there is an old Chinese saying, “Sometimes it is better to say nothing and let the whole world think you are a fool rather than open your mouth and remove all doubt.”
Domestic Steel Stocks are at very high levels, port Ore Stocks are at not at all time low, but pushing the envelope at around 67 million tons. After Chinese New Year, we had anticipated a short run on Ore which has come and gone now. You saw prices shoot upwards, but now reality kicks in and prices have been decreasing gradually for the past week or so. Today we saw the largest loss of USD $5.75/metric ton (MT) on Platts and domestically in China, USD$4.50/MT. The reason for the decrease is due to Ore being pegged in China to Billet price levels and Scrap, and over the past 3-4 days, Billets have dropped RMB80/MT or USD$13/MT and Scrap RMB100/MT or USD$16/MT and we don’t think the slide has subsided.
With these developments, existing Ore offers or new offers are attracting “No” interest for the time being and buyers will take a wait and see position as levels are expected to continue downwards and to what extent or level, we do not know right now. My opinion is China is paying way too high levels for Ore and 62% Fe should be somewhere around the level of USD$100-110/MT CNF FO or lower, but again, my own opinion.
CRC and GI offers are now coming out and initial levels are FOB USD$650/MT for 0.70mm and up effective to 2.50mm and GI is at USD$710/MT FOB for same thickness in 120gr. Base Zinc coating. To get CNF FO levels to EU, add USD$55/MT freight. However, EU is looking to pay around USD$680-685/MT CNF FO for CRC and GI is a bit touchier as firm bids are hard to achieve right now.
Other Steel items such as Plate, WR, Debars etc… are not even being considered for export right now as prices on these items will only start to drop in coming days and I will keep you posted.
John Packard
Read more from John PackardLatest in Steel Products
Nucor keeps HRC price unchanged
Nucor paused its weekly hot-rolled (HR) coil price this week, keeping it flat for the first time since Jan. 21. This comes after a nine-week rally that saw the company increase prices by double-digits for eight of those weeks.
Nucor increases plate prices by $40/ton
Nucor aims to increase prices for steel plate by $40 per short ton (st) with the opening of its May order book. The Charlotte, N.C.-based steelmaker said the increase was effective with new orders received on Friday, March 28, in a letter to customers dated the same day. The company said the price hike applied […]
US CRC price gains ground over imports
US cold-rolled (CR) coil prices increased again this week, while offshore prices declined.
SMU Steel Demand Index momentum slows
Steel Market Update is pleased to share this Premium content with Executive members. Contact info@steelmarketupdate.com for information on how to upgrade to a Premium-level subscription. Growth in SMU’s Steel Demand Index eased in March after reaching a four-year high in late February. Despite a moderate gain, the index remains in expansion territory. The Steel Demand […]
Leibowitz: Impact of tariffs on US manufacturers
On February 10, President Trump announced a massive restructuring of tariffs on steel and aluminum. Those changes took effect on March 12, and they will impact US manufacturing. What will the impact be? Bye-bye exclusions Perhaps the most important change, which hits imports from all countries, is the loss of a product exclusion process to […]