Contact Us

Latest On The Steel Market In India

While, despite overcapacity hang of almost 300-400 million tonnes, the Chinese steel sector is continuing to surprise with yet another post Lunar Holiday surge of about CNY 500 per tonne (USD 70) during February for billets & rebars, prices of plates & HR have not surged.
The regular government announcements of capacity cuts are keeping investors sentiments positive fueling ferrous futures, which in turn are driving spot prices of iron ore, billets & rebars etc although a recent Greenpeace commissioned study has contradicted Chinese government’s announcement of achieving its capacity reduction targets and highlighted that more capacity has been restarted / added.According to Greenpeace, “Steel production capacity elimination in 2016 exceeded targets, with a total of 85 million tonnes of capacity closed. However, three different factors undermined the effectiveness of the efforts.
Only 23 million tons of actual operating capacity were idled as most other was already closed down, about 49 million tonnes of previously idled capacity restarted due to recovery in prices & about 12 million tonnes of new capacity were added.” Thus the recent rally looks unsustainable in long run.However the surge in Chinese steel prices is supporting iron ore prices, which has climbed to multi year high of USD 90 plus, despite all time high inventories of about 127 million tonne at Chinese ports and new supplies from low cost mines of Vale (95 million tonnes) & Roy Hill (65 million tonnes). On the other hand the domestic prices for long & flat products are exhibiting divergent trends. While the secondary market for semis & longs has gained more than INR 2500 (USD35-40) in last 2 weeks, prices of flat products have lost almost INR 4000 (USD 60).

Built by JMB Creative

USA Flag

For North American visitors, please click here

Canadian Flag