TEX reported that negotiations on hot rolled steel coils for the remote areas like Middle East and Central and South America have started for March 2012 shipment. Markups of USD 60 to USD 70 from prices for January shipment have been offered but there seem no orders concluded at these prices.
In Middle East, negotiations are less except certain countries like Saudi Arabia. Offers by the Russian and Chinese mills and POSCO of Korea are not found. The European mills are said to have settled at about USD 50 increase for year round contracts of 2012 with the automotive companies, and as their sale is off and running for the automotive industry, export to Middle East seems to become less. And within the area, prices of hot coils and cold rolled steel sheets are said to have increased by around USD 10 and USD 25 respectively, and for this reason, export at cheaper prices seems to be reduced.
Consequently, the limited mills like the Japanese mills and Hyundai Steel of Korea are proceeding with negotiations in that area at present. Offer prices of Hyundai Steel are said to be USD 700 CNF increased by USD 30 to USD 40 compared with those for February 2012 shipment showing clear signs of price increase. If a customer wants to conclude a contract, its price is said to be the level of USD 670 to 680 CNF which is not changed from a contracted price for February in the last case. The circumstances of price rise can be said not to be ready yet. In the background, there is a view that the leading Asian mills have not withdrawn their offers of USD 620 yet.
As a cheap price offer is still there, a customer is said to be raising concerns about the reason of price increase by Hyundai Steel. However, as negotiations for March 2012 shipment have just started, and all offers of the mills of each country are not being presented, it is said to be one of the factors that negotiations are not ripe yet.
As in the US market its prices increased by USD 35 from the beginning of January 2012 to the level of USD 800 per tonne, import prices are also expected to rise. However, price rise from the 2nd to 3rd week of January 2012 is reported to have stayed only at a single digit of a little over USD 1 and an observation to reach a ceiling begins to appear. In that country, prices of hot coils have continued to rise for 10 weeks in a row till now, and have increased by USD 100 from the bottom. As that market is expected to pull the world market, attention is drawn to see whether its tendency of price increase has ceased.
Meantime, for Central and South America, there are only some offers by part of the mills of Japan and so on, and negotiations have not got into full swing. A customer is said to show a wait and see attitude until offers are all present.
(Sourced from TEX Report Limited)
