European and Chinese Steel Prices Fall

China , Commodities , Europe , Iron ore , Metals , Nickel , Steel , USA Nov 18, 2014 2 Comments

Steel cold roll coilSteel prices in China have fallen from $607 per tonne (£385) in January to $542 (£344) in October. In the US the price has dropped from $861 (£546) to $839 (£532) over the same period.

According to Mintec, the European steel price for cold rolled coil fell from $727 per tonne (£461) in January to $625 (£396) in October.

Loraine Hudson, market analyst at Mintec, said: “The Chinese steel market is having a significant impact on the world market, as it is by far the largest producer and consumer of steel. The Chinese market has witnessed overcapacity in the steel sector, resulting in steel prices dropping domestically. Despite weak demand growth, production has been increasing throughout most of this year.

Despite the slowdown in its domestic market, China is continuing to produce record quantities of steel and this year official figures suggest that output could exceed 80m tonnes. In addition, Chinese producers, which already are among the cheapest in the world due to cheap labor and energy, costs are benefiting from a deep slump in the cost of iron ore and nickel falling into a bear market.

European smelters are already beginning to suffer from a flood of cheap Chinese steel. According to Macquarie, Chinese stainless steel exports to Europe have surged by 115.4pc to 522,000 tonnes in the first three quarters of the year. The broker also notes that China’s share of the market for cold-rolled stainless steel sheet metal, a material used widely in the European car industry, has climbed to 35pc in the past few months, up from just 10pc last year.

Via

Rod Sherkin

Rod is a former senior executive, responsible for Purchasing, for both Pillsbury and Ball Packaging back in the 80’s and 90’s. Since then, he has continued to work in the Purchasing field as both a consultant and founder of the website Propurchaser.com.

2 Comments

  1. Jay

    Thanks for sharing your information. The main reason for this, China is continuing to produce record quantities of steel.

    • Adam

      You’re quite right, thanks for this. We’ve also been enjoying your blog articles: “China’s Steel Industry in Crisis” in particular. Looking forward to future posts and to staying connected.

      Regards,
      Blog Editing Team
      adam@propurchaser.com
      http://www.propurchaser.com

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