Have Flat Steel Prices Bottomed?
Dear Friends,
For long I was missing on my Blog but I am now back. We discuss everyones current favourite topic with which we had launched our Blog : “Flat Steel Prices”.
With H.R.Coils having shown tremendous resistance below USD 500 and even plate prices gradually strengthening to 550 levels from China and Ukraine, I do believe prices have bottomed out. Lack of buyers from the Middle East as well as from Europe and USA in lieu of holiday season may see some attractive spot opportunities in December, 2009 for buying. However, going ahead, I find it safe enough to buy at these levels.
Price level of 525 to 550 for H.R.Coils and Mild Steel Plates between January and March, 2010 seems to be realistic with a possibility of some spurt up to 570 also.
Domestic producers gave some reductions to safeguard against cheaper imports. However, with prices in China, Russia & Ukraine all remaining firm, I do not see any reason for them to continue in this direction.
Local demand has seen some lull in November but historically January to March Quarter has seen heavy action.
Though forecasts in steel have gone quite awry in the last year, I feel confident to predict that prices are headed upwards.
Your Comments.
Regards,
Sanjiv Mehta.
February 12th, 2010 at 8:44 pm
Hello. Its been a long time that you have commented on a forecast. If you could give your thought on prices of plates.
March 2nd, 2010 at 1:39 pm
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March 30th, 2010 at 6:18 pm
In the light of substantial price hikes in raw material prices; I believe that these incremental cost of approx. US$150/ton will be passed on to the consumers and steel prices will inch upwards to US$675-US$700/ton.
Also, I think that quarterly negotiations of coking coal and iron ore contracts will be a new norm for the industry which will decide the volatility in steel prices going forward.
Your comments please!
Regards,
Maulik Mashkaria
+91-9820147360
May 26th, 2010 at 5:59 pm
Dear Mr. Maulik Mashkaria,
Please excuse my extended absence on my Blog due to various reasons.
Your prediction was spot on that commodity prices of H.R.Coils would rise beyond 700. Unfortunately, within 3 weeks they have reversed to 600.
Personally I believe that 600 is as close to the bottom as you can get and would eventually see this settling at an average of 650 over a 12 months period with 50$ swings either way.
In spite of quarterly negotiations becoming a norm, eventual price is demand driven and if demand slows down or projects are put on hold, logic of costs go out of the window.
Best Regards,
Sanjiv Mehta