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Product category: Engineering Industry Reports and Surveys
News Release from: MEPS (International)
Edited by the Engineeringtalk Editorial Team on 13 November 2003

South Korea stars in international steel
market

The recent steel price improvements, which were mainly due to supply side restrictions, have been maintained in the USA, according to the latest International Steel Review.

The recent steel price improvements, which were mainly due to supply side restrictions, have been maintained in the USA, according to the latest International Steel Review Several mills are talking about a US $10 per ton price rise for 1st January

Supplies of imported steel are down sharply and likely to remain so for the immediate future.

However, end user demand remains sluggish, although manufacturing activity has improved in recent months.

Excess inventories have been reduced but buyers are reluctant to rebuild them.

In Japan, local demand from the auto, industrial machinery and shipbuilding sectors is forecast to remain steady.

Exports to South East Asia continue at a high level and prices for deliveries to China have moved up substantially.

However, stock levels continue to grow.

Domestic inventories of strip products, at end August, were up by 4.9% compared with July - the sixth consecutive monthly increase.

Quayside warehouse stocks of imported flat products rose 3.1% over the same period, representing an upward trend for five months.

The South Korean steel sector continues to perform quite well, despite some slow down in economic growth.

Export business, particularly with China, is strong.

Domestic prices are stable.

In Taiwan, CSC has successfully implemented the fourth quarter price rise announced last month for the local market.

Demand from mainland China remains good and International slab prices are soaring.

The company recently decided on period four pricing policy for export business.

Values for shipments of strip products to Japan were left unchanged from the previous quarter.

Plate prices to South East Asian and Chinese clients were raised by US $20 per tonne.

In spite of the EU mills' efforts to reverse the price drop they saw in the third quarter, strip mill product values are either unaltered or slightly lower for fourth trimester business.

Demand continues at a low ebb.

However, third country import volumes are down.

With input costs rising significantly, EU producers are under increasing pressure to raise prices in the near future.

They are expected to seek an improvement for the first quarter of 2004 as long as the euro/US dollar exchange rate remains favourable and China/South East Asia continues to draw in large tonnages.

The Polish economic outlook is more optimistic now.

Industrial output is growing and this should eventually translate into higher steel consumption.

For the moment, however, the situation is unchanged from that reported in September.

Excellent export order books for both steel and manufactured products continue to boost the economies of the Czech and Slovak Republics.

Imports have declined as a percentage of total steel consumption and the mills are enjoying high levels of output.

Despite this rosy scenario, domestic prices have softened slightly in recent weeks, mainly due to fierce competition between local producers.

Escalating input costs for raw materials and energy continue to depress US mills' margins and promote calls for higher steel prices.

However, building activity is still down.

The nonresidential sector is particularly weak.

Consequently, demand for long products is far from buoyant.

Japanese producers are also struggling to raise prices on the back of soaring ferrous scrap charges and transport costs.

Currently, construction remains in the doldrums and forecasts for the short term are not encouraging.

In South Korea, sales of long products are expected to be boosted in the near future, once reconstruction work gets under way following the damage caused by this summer's typhoon.

Present demand is already strong because of high levels of activity in the home building and infrastructure sectors.

The Taiwanese construction industry is in a poor state.

Steel values have largely stabilised this month, following recent upward movements.

EU prices for light long products have increased once again under the influence of higher scrap costs.

The Polish building industry is slow to recover.

Any real pick up is unlikely until at least next Spring.

In Slovakia and the Czech Republics, construction has been very buoyant for some time now but recent predictions cast some doubt over the outlook for the coming winter.

There are very few new projects on the horizon.

Customers are playing safe by reducing their existing inventories.

Therefore, prices have softened as mill business declines.

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