Hyundai seen lifting domestic rebar prices in September
Hyundai Steel is considering lifting domestic rebar sales prices from the beginning of September Steel Business Briefing learns from a company source. The increase margin is expected to be around KRW 20-30,000/tonne ($16-24/t) and will take the mini mill's new price for 10mm diameter bar for direct supply to contractors to KRW 750-760,000/t ($596-604/t). Hyundai's current price for base size rebars . changed 1 August . is KRW 731,000/t while its list price remains KRW 761,000/t. The KRW 40,000-50,000/t increase it introduced earlier this month was necessary to help offset higher scrap costs and maintain profits, as SBB reported. "But even with the increase this month, covering the input costs is still difficult because scrap prices are jumping much higher and faster," the Hyundai source says. Last week, Hyundai contracted four cargoes of ferrous scrap from West Coast USA at $358/t cfr for heavy melting scrap (HMS) 1 basis for September-October shipment. This booking price was around $10/t higher than was contracted the previous week by Chinese importers for US scrap and also more than some $20/t higher than similar contracts concluded at the beginning of August, as SBB reported. Meanwhile, an official from the Korea Construction Procurement Part Association describes Hyundai's move as an .absurd gesture'. "Hyundai's intention is to defend its prices against a drop because it worries that the depressed demand during the present low season will see prices decrease," the official says. He doubts that consumers will accept higher prices and that if so, Hyundai may offer discounts again.
SE Asian billet import prices reach $500/t cfr Levels
Offer prices of imported billet have risen to above $500/t cfr, compared to $480-490/t cfr only a week ago. Offers of Taiwanese billet were priced at $505/t cfr to the region during the week ending 14 August, trading sources tell Steel Business Briefing. Suppliers of Russian and Ukrainian billet are aiming at export prices of $510-520/t cfr and whereas offers of Malaysian billet are around $510/t fob. Traders report unconfirmed bookings of Taiwanese-origin material at $500/t cfr to Vietnam and the Philippines. Local traders note that buyers in Vietnam are still lagging behind in their bidding prices, at $480-485/t cfr. Small quantities of Malaysian billet are believed to have been recently booked at $490/t fob, a higher price because of a lower preferential import duty for Malaysian-origin billet. "Billet prices are really on the boil now," a trader in Ho Chi Ming says. He says that local importers "are trying to resist higher prices but they will buckle" because there is demand. Offers of billet are also very limited in the regional import market. "It is a big jump in prices because scrap has gone up," a regional trader tells SBB. But he says that buyers will be exercising caution having been "burnt before and will not book much, only what they need." Domestic rebar prices in many regional markets can cover the prevailing billet import cost, SBB is told.
SBB Special Report: China inks iron ore price deal with FMG
Chinese mills have welcomed the iron ore price settlement struck between Baosteel and China Iron & Steel Association (CISA), and Australia's third-largest miner Fortescue Metals Group, describing it as a fair result for all parties. Fortescue announced on 17 August that it had agreed to sell its Pilbara fines at US$0.94/dry metric tonne unit (dmtu) and lumps at $1/dmtu from 1 July until the end of this year. This represents a decrease of 35% and 50% respectively on 2008 benchmark prices. The deal is around 3% less than the benchmark price Rio Tinto agreed with other Asian mills in May but is still far from the 40-45% that CISA wanted. As part of the deal Chinese mills are committed to take 20m tones from Fortescue during this period. Fortescue spokesman Cameron Morse told Steel Business Briefing that despite producing just 28m t for the 12 months to 30 June, the miner would reach its July-December target of 20m t by the end of this year as planned. "It will certainly be up around that mark," he said. "It's effectively a (Chinese) government guarantee that mills will take that much ore from us at a time when there's little shortage of iron ore in China," he added. A Baosteel official said that as Fortescue has entered into long-term contracts with Chinese mills for most of its production and is unlikely to sell much on the spot market, it is more willing to agree benchmark terms with Chinese mills than are Rio, BHP Billiton and Vale. "CISA is more open to a flexible pricing system, but negotiations with the other three miners will remain tough," the Baosteel official told SBB. A mill official in eastern China said it made sense for CISA to negotiate a lower price with the Perth-based miner as its iron ore Fe grade is lower than the that of the other major miners. He believed the settlement does not make Fortescue more competitive than its rivals. "The current settled prices are just normal," he says. An analyst based in Perth said Fortescue's ore quality was 8% worse than Rio's but the smaller miner had only conceded a 3% price reduction. "Not a bad deal for them I would've thought," he said. A northern China-based mill official pointed out that the settlement is "conditional" on Chinese mills committing to purchase about 20m t of Fortescue's iron ore in the second half of this year. "It shows that CISA has conceded some ground in the negotiations, which may encourage the larger miners to also raise some additional requirements," he said.
Turkish demand for imported scrap remain slow on high prices
Turkish steel mills booked five deep sea scrap cargoes last week, and with the help of Far East buying prices have continued strengthening, Steel Business Briefing learns from market sources. In the latest transactions HMS 1&2 80:20 was sold for $317-318/tonne cfr, shredded scrap was $322/t cfr and HMS 1&2 70:30 $309/t cfr from US and EU suppliers. Current offer prices have increased a bit on last week. HMS 1&2 80:20 is currently being offered at around $320/t (up by $5-10/t), shredded at $325/t cfr (up by $5/t), and HMS 1&2 70:30 at $310-315/t cfr (up $10/t), SBB learns from traders. CIS prices are also standing firm. The latest transaction for A3 grade scrap was $315/t cfr, which shows $5/t increase on the previous week.
Tokyo Steel lifts scrap buying prices by $20
Tokyo Steel Manufacturing is lifting its scrap purchasing prices by a large ¥2,000/tonne ($21/t) for all grades at all works effective from 18 August arrivals. Though exports are a factor, pundits suggest Tokyo Steel is preparing customers to accept higher steel prices in September. Tokyo Steel is offering more for scrap not just because of stronger regional prices but also because other Japanese mini mills are quietly paying higher .behind prices' to secure supplies, a trader tells Steel Business Briefing. Nevertheless, exports are a factor. The winning bid in the Kanto Tetsugen's H2 scrap export auction held on 11 August was over ¥5,000/t higher than the winning bid in the previous month's auction and lifted the price to ¥31,970/t fas. Though only Korea is currently buying Japanese scrap, Korean mini mill Hyundai Steel has been aggressive with Japanese purchases and is now paying ¥31,800/t fob. But Japanese mini mills still have to collect scrap, and with scrap generation low many have been secretly offering higher prices to secure tonnage. Tokyo Steel's new H2 price at its Okayama works becomes ¥33,000/t ($349/t) for seaborne delivery and ¥32,000/t for truck delivery while H2 at Kyushu, Takamatsu and Utsunomiya will fetch ¥31,000/t, ¥31,500/t and ¥32,000/t respectively. It last changed its prices for 6 August arrivals adding ¥500/t . and held them for 10 days over Japan's .Obon' summer holidays. Tokyo Steel will table its domestic list prices for September on 18 August. "This scrap price increase might be Tokyo Steel's tactics to lift their list prices, blaming higher scrap costs," the scrap dealer noted
Hyundai Steel is considering lifting domestic rebar sales prices from the beginning of September Steel Business Briefing learns from a company source. The increase margin is expected to be around KRW 20-30,000/tonne ($16-24/t) and will take the mini mill's new price for 10mm diameter bar for direct supply to contractors to KRW 750-760,000/t ($596-604/t). Hyundai's current price for base size rebars . changed 1 August . is KRW 731,000/t while its list price remains KRW 761,000/t. The KRW 40,000-50,000/t increase it introduced earlier this month was necessary to help offset higher scrap costs and maintain profits, as SBB reported. "But even with the increase this month, covering the input costs is still difficult because scrap prices are jumping much higher and faster," the Hyundai source says. Last week, Hyundai contracted four cargoes of ferrous scrap from West Coast USA at $358/t cfr for heavy melting scrap (HMS) 1 basis for September-October shipment. This booking price was around $10/t higher than was contracted the previous week by Chinese importers for US scrap and also more than some $20/t higher than similar contracts concluded at the beginning of August, as SBB reported. Meanwhile, an official from the Korea Construction Procurement Part Association describes Hyundai's move as an .absurd gesture'. "Hyundai's intention is to defend its prices against a drop because it worries that the depressed demand during the present low season will see prices decrease," the official says. He doubts that consumers will accept higher prices and that if so, Hyundai may offer discounts again.
SE Asian billet import prices reach $500/t cfr Levels
Offer prices of imported billet have risen to above $500/t cfr, compared to $480-490/t cfr only a week ago. Offers of Taiwanese billet were priced at $505/t cfr to the region during the week ending 14 August, trading sources tell Steel Business Briefing. Suppliers of Russian and Ukrainian billet are aiming at export prices of $510-520/t cfr and whereas offers of Malaysian billet are around $510/t fob. Traders report unconfirmed bookings of Taiwanese-origin material at $500/t cfr to Vietnam and the Philippines. Local traders note that buyers in Vietnam are still lagging behind in their bidding prices, at $480-485/t cfr. Small quantities of Malaysian billet are believed to have been recently booked at $490/t fob, a higher price because of a lower preferential import duty for Malaysian-origin billet. "Billet prices are really on the boil now," a trader in Ho Chi Ming says. He says that local importers "are trying to resist higher prices but they will buckle" because there is demand. Offers of billet are also very limited in the regional import market. "It is a big jump in prices because scrap has gone up," a regional trader tells SBB. But he says that buyers will be exercising caution having been "burnt before and will not book much, only what they need." Domestic rebar prices in many regional markets can cover the prevailing billet import cost, SBB is told.
SBB Special Report: China inks iron ore price deal with FMG
Chinese mills have welcomed the iron ore price settlement struck between Baosteel and China Iron & Steel Association (CISA), and Australia's third-largest miner Fortescue Metals Group, describing it as a fair result for all parties. Fortescue announced on 17 August that it had agreed to sell its Pilbara fines at US$0.94/dry metric tonne unit (dmtu) and lumps at $1/dmtu from 1 July until the end of this year. This represents a decrease of 35% and 50% respectively on 2008 benchmark prices. The deal is around 3% less than the benchmark price Rio Tinto agreed with other Asian mills in May but is still far from the 40-45% that CISA wanted. As part of the deal Chinese mills are committed to take 20m tones from Fortescue during this period. Fortescue spokesman Cameron Morse told Steel Business Briefing that despite producing just 28m t for the 12 months to 30 June, the miner would reach its July-December target of 20m t by the end of this year as planned. "It will certainly be up around that mark," he said. "It's effectively a (Chinese) government guarantee that mills will take that much ore from us at a time when there's little shortage of iron ore in China," he added. A Baosteel official said that as Fortescue has entered into long-term contracts with Chinese mills for most of its production and is unlikely to sell much on the spot market, it is more willing to agree benchmark terms with Chinese mills than are Rio, BHP Billiton and Vale. "CISA is more open to a flexible pricing system, but negotiations with the other three miners will remain tough," the Baosteel official told SBB. A mill official in eastern China said it made sense for CISA to negotiate a lower price with the Perth-based miner as its iron ore Fe grade is lower than the that of the other major miners. He believed the settlement does not make Fortescue more competitive than its rivals. "The current settled prices are just normal," he says. An analyst based in Perth said Fortescue's ore quality was 8% worse than Rio's but the smaller miner had only conceded a 3% price reduction. "Not a bad deal for them I would've thought," he said. A northern China-based mill official pointed out that the settlement is "conditional" on Chinese mills committing to purchase about 20m t of Fortescue's iron ore in the second half of this year. "It shows that CISA has conceded some ground in the negotiations, which may encourage the larger miners to also raise some additional requirements," he said.
Turkish demand for imported scrap remain slow on high prices
Turkish steel mills booked five deep sea scrap cargoes last week, and with the help of Far East buying prices have continued strengthening, Steel Business Briefing learns from market sources. In the latest transactions HMS 1&2 80:20 was sold for $317-318/tonne cfr, shredded scrap was $322/t cfr and HMS 1&2 70:30 $309/t cfr from US and EU suppliers. Current offer prices have increased a bit on last week. HMS 1&2 80:20 is currently being offered at around $320/t (up by $5-10/t), shredded at $325/t cfr (up by $5/t), and HMS 1&2 70:30 at $310-315/t cfr (up $10/t), SBB learns from traders. CIS prices are also standing firm. The latest transaction for A3 grade scrap was $315/t cfr, which shows $5/t increase on the previous week.
Tokyo Steel lifts scrap buying prices by $20
Tokyo Steel Manufacturing is lifting its scrap purchasing prices by a large ¥2,000/tonne ($21/t) for all grades at all works effective from 18 August arrivals. Though exports are a factor, pundits suggest Tokyo Steel is preparing customers to accept higher steel prices in September. Tokyo Steel is offering more for scrap not just because of stronger regional prices but also because other Japanese mini mills are quietly paying higher .behind prices' to secure supplies, a trader tells Steel Business Briefing. Nevertheless, exports are a factor. The winning bid in the Kanto Tetsugen's H2 scrap export auction held on 11 August was over ¥5,000/t higher than the winning bid in the previous month's auction and lifted the price to ¥31,970/t fas. Though only Korea is currently buying Japanese scrap, Korean mini mill Hyundai Steel has been aggressive with Japanese purchases and is now paying ¥31,800/t fob. But Japanese mini mills still have to collect scrap, and with scrap generation low many have been secretly offering higher prices to secure tonnage. Tokyo Steel's new H2 price at its Okayama works becomes ¥33,000/t ($349/t) for seaborne delivery and ¥32,000/t for truck delivery while H2 at Kyushu, Takamatsu and Utsunomiya will fetch ¥31,000/t, ¥31,500/t and ¥32,000/t respectively. It last changed its prices for 6 August arrivals adding ¥500/t . and held them for 10 days over Japan's .Obon' summer holidays. Tokyo Steel will table its domestic list prices for September on 18 August. "This scrap price increase might be Tokyo Steel's tactics to lift their list prices, blaming higher scrap costs," the scrap dealer noted
Malaysian Ringgit Exchange Rate