It is reported that the HR coil market in East Asia has weakened again in the wake of canceled HR coil imports into China from Russia, in which it remains to be seen what alternative destination will emerge for those Russian HR coils.
In East Asia, China"s domestic demand for HR coils indicates a recovery. In fact, local users have reacted with new inquiries for HR coil purchases. Domestic HR coil prices before tax translate into levels of USD 555 per tonne for products from Baosteel Co Limited and USD 547 per tonne for ones from Wuhan Iron & Steel Group Corp for March shipments.
By comparison, offer prices of HR coil exports to China by South Korean and Japanese integrated steelmakers stand at a level of USD 450 per tonne FOB. Until now, Chinese users have firmed up import deals this time for HR coils from South Korea and Japan. Negotiated prices are estimated at a level of USD 470 per tonne C&F for delivery in China, which amounts to the going market for HR coil imports there.
In East Asia, it is likely that concentrated HR coils offers into a specified destination or destinations will dwindle as HR coil inquiries from various users are on the increase, according to market sources. In Taiwan, China Steel Corp has told domestic customers that the company intends to price down HR coils by the equivalent of USD 87 per tonne on for April and May 2009 shipments.
Meanwhile, Japanese integrated steelmakers see an approaching time to start negotiations on their HR coil exports to Asian destinations for shipments in the April to June 2009 quarter. But they have the wisdom to mark time so far because the environment has yet to form for what they negotiate. They are contemplating struggling to win a certain increase from the present price level in Asian deals of HR coil exports for April to June 2009 shipments while watching how things go.