According to market sources, there is growing speculation that HR coil market conditions for export deals in Asia will rebound for a recovery in or after April 2009 when an environment forms there for an upswing in HR coil prices.
At present, the HR coil market in Asia is quiet due to the lunar New Year holidays in parts of East Asia such as China, South Korea, Taiwan, and Hong Kong. Attention has already begun to focus on how market conditions go after those holidays.
In China, Baosteel Co Limited intends to raise the HR coil price by CNY 300 to CNY 4,437 per tonne after value added tax for March 2009 shipments. Its new HR coil price translates into USD 555 per tonne before VAT. In February, China's other major integrated steelmakers such as Wuhan Iron & Steel Group Corp and Anshan Iron & Steel Group Corp are expected to give domestic customers notice on separate price increases of HR coils for March shipments.
It remains to be seen whether those low prices on offer to Asia will disappear in the immediate future. HR coils for sacrifice sales are limited in quantity, but low prices of HR coils are pervasive in the world's markets. In the past, an upswing in HR coil prices led to increased prices of HR coil derivatives such as CR sheets, but no advance in HR coils was expected in the absence of a rebound or advance in prices for the derivatives. Under the existing circumstances, no immediate rebound is expected in the prices of the derivatives, an environment that precludes an early upswing in HR coil prices for export deals in Asia.