August 29, 2008

Chinese CR export prices remain stable

It is reported that Cold rolled steel coil prices are largely unchanged in Chinese domestic market. Export quotations remain firm and most steel mills are dealing with business for March shipment.

Current prevailing offer for 1.0mm CRC has risen to USD 750 per tonne FOB from USD 730 per tonne to USD 740 per tonne in the past two weeks. There have been more transactions than before taken into account the competitive price.

A North East China based tier one steel maker has been fully booked for March shipment at USD 30 per tonne FOB as base price. It is expected to announce the price for April shipment in end January or early next month. While another major steel mills in central China also have finished its contract for March shipment now, with base price at USD 720 per tonne FOB which is likely to be the most competitive in China.

Export price are anticipated to move up further on ascending domestic CRC prices. On Shanghai market, 1.0 CR sheet by Anshan Steel goes at CNY 5800 per tonne 1.0 CR coil by Maanshan Steel is being offered at CNY 5700 per tonne.

Now the price for 1.0 CR sheet by Anshan steel is very close to the target of CNY 5900 per tonne which we have already forecast late last year. If it could surpass CNY 5900 per tonne, there should be another round of increase. Normally CR coil price would be CNY 100 per tonne to CNY 150 per tonne lower than that of CR sheet.