Export negotiations on blast furnace steel wire rods for Asia by the Japanese BF mills have almost passed over the peak for shipment of August and September. Contracted prices were settled at levelling off from those for July shipment and quantity remained unchanged as has happened in the past.
As the USA determined finally to be affirmative for an antidumping case on wire rods imported from China, wire rods of China are flowing to Central and South America, Middle East, Africa and ASEAN. Prices of Chinese high carbon wire rods for construction are said to be USD 550 FOB. Compared with prices of Japanese products, those prices are cheaper by more than USD 100 and Japan is also facing difficulty to raise their prices of other grade wire rods.
As in China, Baoshan Iron & Steel, Wuhan Iron & Steel and so on left their domestic prices of wire rods unchanged for shipment of July/August, the Japanese mills were difficult to raise their prices, and on the other side of the coin, request for a decrease in price seems not to have been strong much. Further, as fluctuations of prices of raw materials for a BF are not much from their anticipation at the beginning of negotiations, request for a decrease in price on the ground of a price down of raw materials was few, and consequently, they could finish their negotiations at levelling off of prices.
It had been concerned about quantity decrease caused by a decrease in demand for wire rods for automobiles due to economic turmoil in Thailand. However, as production quantity of automobiles in that country is likely to become around 1,990,000 (2,400,000 cars in 2013) instead of 1,900,000 cars of initial anticipation and with concern over strike, customers accumulated inventory, a decrease in quantity is said to have been avoided unexpectedly.
The Chinese automotive industry is steady. However, it is concerned about future trends as its production quantity of commercial vehicles is dipping below that in the previous year.
Source – The TEX Report