Domestic distributors dealing with hot rolled steel sheet and strip are moving all to escalate the HR price up to 700,000 won per ton level on the authorized grade basis. Such a price rising trend on distribution channel seems at the mercy of the mills which declared the price increase over the fourth quarter.
According to the domestic HR distributors, Steel Service Centers increased their sale price in part beginning the middle of October. POSCO’s SSCs dealing with hot coils raised the price up to 710,000~720,000 won per ton on the first hand distributor and the company bill basis on the authorized grade, while increased to 670,000~680,000 won per ton on the GS grade as well. Hyundai Steel SSCs also are known to increase at once to 710,000 won per ton beginning October 19. In the second week, Hyundai Steel had notified of the 50,000 won per ton increase level over October to its SSCs. Distributors thus addressed that pricing trend in a week.
Entering the second half, domestic HR market is seeing distribution price rise up apart from the first half on the increased supplying price by the mills every month entering the second half. Especially, distributors are engaged in securing the profitability, thus the price can be increased given the smaller orders.
Looking at by period, the price increase could be proceeded during July and August thanks to the decreased import surge from China and the seasonal boosting and the consequent lack of sufficient stock levels. However, entering September, the price increase was limited because of the weakness of Chinese materials competition, softer foreign exchange rate, and slowed speculative demand. Distributors therefore declared to go through the profitability by addressing the price increase during the October delivery. Even the second-hand local distributors are said to join the price increase only if the first-hand chains are actively responsive to the trend.
Source:Steel & Metal News
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