The global steel market is presenting a complex picture this week. While some regions experience slight price increases, a concerning trend of softening demand and declining prices is taking hold in others. This update will delve into the details, exploring price movements and potential implications across key steel-producing and consuming regions.
Export scrap prices in Japan, reported at JPY 52,100/t ($327/t) FOB Tokyo on July 12, saw an increase of JPY 700/t ($4/t) due to the impact of the Kanto tender. Conversely, the average domestic scrap price decreased by JPY 500/t ($3/t), with the average price across three regions settling at JPY 51,300/t ($326/t). Despite these price movements, demand remains stagnant with slow booking activity indicating no signs of improvement.
In China, the price of domestic HRC dropped to Yuan 3,658/t ($504/t) on Jul. 22, marking a decrease of Yuan 50/t ($8/t) from the previous week, influenced by SHFE futures prices which fell by Yuan 72/t ($10/t). Concurrently, export HRC prices also saw a reduction, standing at $510/t, down by $5/t compared to the previous week. The combination of weak demand both domestically and globally, along with high inventory levels, continues to exert pressure on the price trend.
In Vietnam, the rising demand for rebar steel and overall market improvements have fueled manufacturers to increase consumption, with notable growth seen in major steel companies. Despite a slight uptick in demand for rebar steel, prices have remained steady at $572 per ton for a week.
HRC prices in Europe are showing a downward trend compared to the previous week. In Northern Europe, HRC prices were at EUR 620/t ($675/t) on Jul.19, marking a decrease of EUR 13/t ($14/t) from a week ago. Similarly, HRC prices in Southern Europe saw a slight dip of EUR 2/t ($2/t), reported at EUR 625/t ($672/t). Demand remains stable but at relatively low levels.
A major steelmaker in America has been steadily declining since mid-June, experiencing a significant decrease of $110 per ton over the course of five weeks. Following suit, a prominent steel producer, recently revealed a parallel trend by adjusting their base price for spot HR to $720 per ton for August orders, reflecting a reduction of $80 per ton compared to their July pricing guidance.
The export price of HRC in Brazil has remained stable at $835/MT for the past two weeks. Similarly, domestic scrap prices in Mexico have shown no movement from the previous week, standing at $404/MT. Additionally, export slab prices in Brazil have been reported at $555/MT FOB main ports, showing a slight increase of $5/MT over the week.
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